A popular fast food chain, BurgerFi, is facing financial troubles and might declare bankruptcy. This news has raised concerns about potential widespread restaurant closures.
BurgerFi, a competitor of In-N-Out, has been struggling since the COVID-19 pandemic and is now considering shutting down several of its locations.
Struggling Burger Chain Seeks Financial Rescue
Like Red Lobster, the burger chain BurgerFi, founded in 2011, faces severe financial challenges. According to The U.S. Sun, the company is losing millions of dollars each month and has sought the help of economic experts to explore ways to save the business.
This development follows the chain's decision to close 14 locations in 2023 and an additional eight earlier this year. BurgerFi operates 102 locations in Maryland, Florida, North Carolina, New York, and Indiana. The last time the chain had fewer than 100 outlets was in 2018.
MSN revealed that in January, the company was removed from the Nasdaq because its share price dropped below the minimum $1 required by the stock exchange. By Monday, the share price had plummeted to just 32 cents.
The company's financial issues deepened in April when it failed to make loan payments, indicating that its economic problems were more severe than previously revealed.
A month later, at an earnings update, it was disclosed that sales for the first quarter of 2024 had decreased by 13 percent compared to the previous year, with losses exceeding $6 million. This followed a similar pattern of declining sales in the last quarter of 2023.
Also Read: TGI Fridays Announces Closure of yet Another Location amidst Companywide Shutdowns
BurgerFi Initiates Review Amid Financial Crisis
BurgerFi also owns 60 Anthony's Pizza restaurants, which face similar difficulties. On Thursday, David Heidecorn, the company's new chairman, announced a "strategic review" to explore all possible options to salvage the business.
He acknowledged that the chain's low cash reserves posed a significant challenge and hinted that the review might not result in a positive outcome.
Despite these challenges, BurgerFi maintains on its website that since its inception in 2011, it has been committed to delivering high-quality, fresh burgers, boasting of using top suppliers and maintaining strict standards for flavor and quality in all its offerings.
Meanwhile, the BurgerFi website highlights that it prides itself on serving top-notch Angus Beef and all-natural chicken that is always free from antibiotics and available to customers every day, including Sundays.
The company's "Never-Ever" program guarantees that their Angus beef is raised without steroids, antibiotics, growth hormones, or additives, ensuring a pure and quality product for their patrons.
DailyMail contacted BurgerFi on Monday, but the company's spokesperson declined to provide any further statements.
Recent bankruptcies and closures have hit the retail and restaurant industries hard. In May, Red Lobster, a well-known seafood chain, closed nearly 100 locations and declared bankruptcy.
Adding to the turmoil, Foxtrot, a national chain known for its coffee and upscale grocery offerings, announced in early April that it would abruptly close all its stores, leaving employees and customers in shock.
Established in 2014 in Chicago, Foxtrot has expanded to 33 locations across Chicago, Austin, Dallas, and Washington, DC.
In a similar downturn, Express, a familiar sight in malls, filed for bankruptcy in April and announced plans to close 95 of its stores, signaling ongoing challenges within the retail.
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