BurgerFi International, the parent company of BurgerFi and Anthony’s Coal Fired Pizza & Wings, has filed for Chapter 11 bankruptcy, joining a growing list of restaurant operators struggling in the current economic climate.
The Fort Lauderdale-based company filed for protection in the U.S. Bankruptcy Court in Wilmington, Delaware, listing assets of at least $50 million and liabilities of over $100 million. The bankruptcy proceedings apply only to the company’s 67 corporate-owned locations, which include 17 BurgerFi outlets and 50 Anthony’s Coal Fired Pizza & Wings locations.
The company’s decision to file for bankruptcy is rooted in a perfect storm of economic challenges. Jeremy Rosenthal, the Chief Restructuring Officer, cited a “drastic decline in post-pandemic consumer spending,” compounded by ongoing inflation and rising food and labor costs. These factors have pushed several restaurant chains, including Roti, Buca di Beppo, and Red Lobster, to seek bankruptcy protection in 2023.
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BurgerFi, founded in 2011, went public in 2020 with high hopes of expanding its business. However, despite efforts to turn the company around, including launching a strategic initiative last year, the lingering effects of economic headwinds proved too significant.
CEO Carl Bachmann pointed to “legacy challenges” that necessitated the filing, though he also highlighted some “early positive indicators” of their turnaround plan.
The company’s filing estimates its assets to be in the range of $50 million to $100 million, while its liabilities are projected to be between $100 million and $500 million. Despite these financial setbacks, BurgerFi remains committed to restructuring and potentially emerging from bankruptcy with a more sustainable business model.
The challenges facing BurgerFi reflect broader difficulties in the restaurant industry, particularly for those trying to recover from the economic fallout of the COVID-19 pandemic. The company’s struggle to balance rising operational costs with weakened consumer spending is a cautionary tale of how even established brands can be vulnerable in today’s marketplace.
As BurgerFi works to stabilize its business, the focus will likely be on reassessing its operational strategy, potentially closing underperforming locations, and negotiating with creditors to restructure its debts. How the company navigates these challenges will determine its future in an increasingly competitive and unpredictable restaurant landscape.
