A US hamburger chain is the latest to weigh restaurant closures and bankruptcies as sales plummet.
BurgerFi – which bills itself as a higher-end McDonald’s – has called in experts to try to save the company, which is losing millions of dollars a month.
Bosses are eyeing a Chapter 11 bankruptcy, which would allow the company to cancel leases on its worst-performing restaurants and sell off the contents – as Red Lobster did last month.
Last year, BurgerFi closed 14 restaurants and in the first three months of the year, eight more closed, leaving 102.
Most are in the East, with most in Florida, Maryland, North Carolina, New York and Indiana.
BurgerFi, which launched in 2011, is considering bankruptcy — fearing restaurant closures
There have been a number of setbacks for the company this year.
In January, the chain was delisted from the Nasdaq after its plummeting share price fell so far that it fell below the $1 minimum the exchange insists on. On Monday it was 32 cents.
Then in April, BurgerFi defaulted on a loan – a sign that its financial problems were worse than they let on.
A month later, a profit update showed that sales for the first three months of 2024 were 13 percent lower than the year before. Losses totaled more than $6 million this quarter.
Sales had also fallen by double digits in the last quarter of 2023.
The company also owns 60 Athony’s pizza restaurants, which are also in trouble.
The ‘strategic review’ will be announced on ThursdayDavid Heidecorn, the company’s new chairman, said: “We are committed to considering all potential strategic alternatives.”
But he admitted the lack of money at the bank was a challenge.
As a result, the review may lead to an ‘unfavorable outcome’.
BurgerFi says on the website: ‘We don’t just serve tasty burgers. Since 2011, we have been serving the highest level of burgers, made with fresh ingredients from the best suppliers across the country, with an uncompromising standard for taste and quality in everything we do.”
DailyMail.com contacted BurgerFi on Monday. A spokesperson said they would not be making any further statements.
BurgerFi has closed eight restaurants so far in 2024 and is in financial trouble
BurgerFi also operates 60 restaurants under the Anthony’s pizza brand
There has been a wave of bankruptcies in recent months, contributing to the closure of restaurants and shops.
Red Lobster closed nearly 100 stores and filed for bankruptcy in May.
National coffee and luxury supermarket chain Foxtrot said in early April it would close all its stores with immediate effect, leaving staff and customers stunned.
Founded in 2014 in Chicago, Foxtrot had 33 locations in the Chicago, Austin, Dallas and Washington DC areas.
Meanwhile, retailer Express, a key part of the shopping centre, filed for bankruptcy in April and said it would close 95 outlets.