National burger chain files for bankruptcy – sparking fears of mass closures

An upscale American hamburger chain is the latest restaurant chain to file for bankruptcy – as the number of victims in the sector increases.

BurgerFi — which also owns Anthony’s Coal Fired Pizza — filed for Chapter 11 bankruptcy protection in a Delaware court on Wednesday, citing debts of as much as $500 million.

The company has 162 locations of the two brands, including a flagship BurgerFi in New York that opened just a few months ago. All are under threat.

It is the latest restaurant chain to file for bankruptcy in 2024, following Red Lobster, Rubio’s, Buca di Beppo, World of Beer, Roti and Melt Bar & Grill.

Like Red Lobster this summer, BurgerFi hopes to get out of the leases of its worst-performing restaurants, allowing them to cut costs and pay down debt.

BurgerFi, which bills itself as a competitor to Shake Shack and Five Guys, sells its cheeseburger for about $11 at its 102 restaurants.

BurgerFi warned last month that bankruptcy was a possibility, with executives saying it had just $4.4 million in the bank as of August 14.

ISecond-quarter revenues were expected to be a staggering $18.4 million.

The bad news for BurgerFi staff and fans comes after the chain closed eight restaurants in the first three months of the year.

This was on top of 14 closures last year, leaving just 102 locations in the U.S. There are 60 Anthony’s Pizza restaurants.

Most restaurants are located in Florida, Maryland, North CarolinaNew York and Indiana.

BurgerFi’s website states: ‘We don’t just serve great burgers. Since 2011, we’ve been serving next-level burgers made with the freshest ingredients from the best suppliers across the country, with an uncompromising standard for taste and quality in everything we do.’

The company said the closures were the main reason for the decline in sales, along with rising food and labor costs.

The company first sounded the alarm in May, when it first announced that it due to the lack of money, consider ‘strategic alternatives’.

BurgerFi has closed eight restaurants so far in 2024, after several closures last year

BurgerFi also operates 60 restaurants under the Anthony’s pizza brand

Since its IPO in 2020, BurgerFi shares have fallen nearly 60 percent, trading at just 14 cents on Wednesday.

The move follows a series of restaurant closures across the US as businesses grapple with rising food and labor costs.

Popular Italian restaurant Buca di Beppo filed for bankruptcy in August, just days after it abruptly closed 13 underperforming locations.

World of Beer Bar & Kitchen was named one of the fastest growing restaurant chains in the US in 2013.

In August, the company also filed for Chapter 11 bankruptcy, saying it still owed suppliers about $50 million.

National coffee and luxury supermarket chain Foxtrot announced in early April that it would be closing all of its stores with immediate effect, leaving staff and customers stunned.

Businesses are struggling with declining sales as Americans eat out less after two years of steep price increases.