Several Burger King locations in Florida and Georgia could soon be at risk of closure after Consolidated Burger Holdings, one of the largest franchisees of the fast food chain, filed for Chapter 11 bankruptcy protection.
On Monday, April 14, the company, which operates 57 Burger King restaurants, revealed that it owes nearly $37 million to creditors. The company, based in Destin, Florida, attributed its financial struggles to several factors, including the impact of the COVID-19 pandemic, which led to a significant loss in foot traffic. As a result, revenue declined while fixed costs like rent and debt obligations remained unchanged.
Consolidated Burger Holdings cited “significant hurdles resulting from industry headwinds,” such as rising shipping and food costs, labor shortages, and inflation, which further weakened the company’s financial position. The company’s bankruptcy filing also noted that its “highly leveraged balance sheet” had depleted its liquidity, making it difficult to stay afloat.
Before filing for bankruptcy, the company spent seven months trying to find a buyer for its locations. Despite the filing, the 57 restaurants will continue to operate while the company seeks new ownership.
Consolidated Burger Holdings is not the first Burger King franchisee to face financial difficulties. TOMS King Holdings LLC, which operated 90 Burger King locations across several states, filed for bankruptcy in January 2023 due to debt and poor performance. Many of its restaurants have since been sold or closed. Similarly, Meridian Restaurants Unlimited, which ran 100 Burger King locations in Minnesota, Kansas, and Nebraska, filed for bankruptcy in March 2023.
As the fast food industry grapples with rising costs and labor shortages, the fate of dozens of locations remains uncertain.
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