8 Restaurant Chains That Are Struggling Financially

With their fancy marquees and changeless all-you-can-eat flash sales, it's tempting to deliberation that franchising a edifice concatenation is simply a guaranteed fiscal success, whether it's McDonald's oregon Hardee's oregon adjacent Planet Hollywood. However, this isn't ever the case. According to DoorDash, the mean edifice nett borderline is lone betwixt zero and 15%, though astir autumn betwixt the 5% and 10% ranges.

Moreover, the wide representation for edifice nutrient chains is simply a spot much nuanced today. A azygous franchise proprietor for a concatenation similar Hardee's oregon Hooters mightiness person galore stores -- 79 oregon truthful -- but the corp that licensed the franchisee could person 49 much franchisees with each having its ain passel of stores. If 1 franchisee retired of the 50 files for bankruptcy, possibly that's nary biggie. However, if you adhd to that sluggish income among the different franchisees, a much implicit representation emerges. While the corp that licenses each those franchises whitethorn not technically beryllium bankrupt, this doesn't mean the fiscal picture's rosy. With the franchise model, it's a clump of smaller businesses nether the umbrella of a bigger one. If capable spell under, eventually, the corp will, too.

To adhd insult to injury, galore owners wrong the franchise strategy whitethorn effort to merchantability disconnected properties that aren't doing well, but not rather bankrupt. Within the past respective years, for example, hundreds of McDonald's franchise owners person sold their stores. Suffice it to accidental that what's happening with McDonald's franchisees is simply a snapshot of the fiscal troubles plaguing the full industry. Here's a person look astatine a fewer different edifice franchises that are besides feeling the fiscal heat.

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Boston Market

With a paper filled with the likes of blistery rotisserie chicken, heavy slices of meatloaf oregon specialty hams, creamy macaroni and cheese, and heaps of steaming veggies, it's hard to judge that the Boston Market edifice concatenation could acquisition immoderate benignant of fiscal trouble. The nutrient is the adjacent champion happening adjacent to homemade. However, the concatenation -- which has restaurants chiefly connected the East Coast and successful the Midwest -- has had galore fiscal issues successful caller years.

In 2022, the Colorado Department of Revenue paid a sojourn to the company's location bureau successful Golden, Colorado. Seems determination was a beef astir the $329,000 the institution owed successful payroll taxes and unpaid income tax. The pursuing twelvemonth saw locations successful Connecticut and Florida abruptly unopen down, though the biggest thorn successful the broadside for the edifice concatenation had to beryllium the $11 cardinal the institution owed to U.S. Foods. All of these challenges resulted successful 2 failed attempts astatine bankruptcy owed to procedural issues and a downward spiral that took the concatenation from 300 stores to 27. In all, the chain has faced astir 150 lawsuits arsenic a effect of unpaid bills arsenic good arsenic accusations of hr and wage violations.

Despite the onslaught of fiscal woes, the concatenation has made plans to unfastened a caller edifice determination successful Buffalo, New York. There's besides immoderate speech astir licensing the Boston Market conception to imaginable store owners astir the country. Still, Boston Market's terms for fractional a rotisserie chickenhearted comes successful astatine astir 3 times the magnitude of a Costco's roast chicken, which sets you backmost lone astir $5, springiness oregon take.

Hwy 55 Burgers, Shakes & Fries

When you're sitting successful a slick, retro diner similar Hwy 55 Burgers, Shakes & Fries, it's casual to hide that the extracurricular satellite exists -- and that it sometimes has precise important effects connected your burger-and-fries dinner. In Hwy 55's case, the extracurricular satellite that encroached was the fiscal troubles that the edifice chain's genitor company, Little Mint, Inc. had been having for respective years. The astir caller spot of fiscal ickiness was the Chapter 11 bankruptcy Little Mint, Inc. filed successful the aboriginal portion of 2025.

Shortly thereafter, stores successful the Southeast, wherever the concatenation is located, began closing unexpectedly, though customers did fishy thing successful the days starring up to immoderate of the closures. In Tullahoma, Tennessee, the edifice went from afloat sit-down seating to online and drive-through lone to That's-all-she-wrote-folks. More store closures followed. One edifice -- the Murfreesboro determination -- had lone had its doors unfastened for a fewer months earlier it was shuttered.

The bankruptcy came arsenic a effect of labour shortages and disruptions caused by the pandemic. It's a predicament that galore accelerated nutrient chains are inactive grappling with today, 5 years later. In all, Little Mint, Inc. had 71 franchise stores and 22 firm stores. After the particulate settles, Hwy 55's genitor institution hopes to resume operations and travel backmost stronger than ever. Time volition archer if this retro marque of accelerated nutrient rises again.

Hooters

It wasn't agelong aft Hooters filed Chapter 11 bankruptcy successful April of 2025 that the accelerated food/fast casual concatenation started closing restaurants -- astir 3 months to beryllium exact. It besides took the concatenation conscionable that agelong to spell from saying it's "here to stay" (per CNN) to closing down astir 30 locations successful a fistful of states, including Georgia, North and South Carolina, and Texas.

On the surface, the bankruptcy seemed similar it would springiness Hooters a changeable astatine reorganizing its debt. It projected selling disconnected 100 restaurants owned by Hooters Corporate to a fewer of the company's franchisees. As for the closures, the determination fundamentally trimmed the abdominous and ensured that lone the astir profitable stores stay open.

It's conscionable the latest section successful the past of a nutrient concatenation that six friends with nary edifice acquisition opened due to the fact that they wanted a edifice "they couldn't get kicked retired of," according to the company's bio page. Over the years, determination has been a Hooters casino, Hooters Air -- yes, airplanes with Hooters servers arsenic formation attendants -- and car sponsorship astatine NASCAR, which ended erstwhile the edifice concatenation didn't wage for its commitments to the race. Add rising nutrient and labour costs to shrinking lawsuit wallets, and you person the look for a concern that's trying not to crash.

KFC

It's a motion of the times erstwhile a accelerated nutrient edifice concatenation with "Kentucky" successful its sanction moves its office retired of its namesake authorities and into Plano, Texas. As it turns out, that's conscionable what KFC (Kentucky Fried Chicken) is doing. After 3 consecutive quarters of losses successful 2024, a determination distant from location seems similar an absorbing choice. For those wondering, "Why Texas?" the reply is simple. KFC's genitor corporation, Yum! Brands owns Pizza Hut, and Pizza Hut is successful Plano.

There are plentifulness of challenges to spell on with this strategy. At accelerated nutrient giant, Pizza Hut, income are down, too. Collaborations betwixt the 2 brands whitethorn not beryllium arsenic fruitful arsenic 1 mightiness hope. It's besides worthy pointing retired that, with its large family-style buckets o' chicken, KFC isn't precisely the spot wherever azygous eaters tin find caller fried chickenhearted meals astatine a bully terms -- not compared to different fashionable chickenhearted places, anyway.

Still, possibly the determination mixes things up a spot and allows employees from the 2 brands to cross-pollinate their ideas. KFC needs to crook its finances around, and this whitethorn beryllium the lone mode to bash it. It's a gamble, fixed that KFC's competitors are brands similar Popeye's,  which proceed to outpace the income of the 95-year-old company. In 2023, Popeye's opened astir 100 stores successful America, and KFC closed astir 100. There was besides a drawstring of KFC franchisee bankruptcies overseas that saw hundreds of restaurants adjacent down. Given that, a alteration of firm venues whitethorn not beryllium enough.

Sticky Fingers

It seems similar the lone happening sticking to Sticky Fingers this twelvemonth is the fiscal troubles caused by the COVID-19 pandemic and a downfall successful nutrient prime and service. In the archetypal 4th of 2025, Sticky Fingers filed for Chapter 11 successful an effort to marque the effects of the pandemic a small little sticky and the institution much solvent, per FSR magazine. Truth beryllium told, the institution faces an uphill battle. The 33-year-old institution had 16 stores anterior to 2020. When it filed for bankruptcy, it listed betwixt $1 cardinal and $10 cardinal successful indebtedness and $50,000 successful assets.

Ironically, close earlier the pandemic, the institution began making improvements, and things looked similar they were connected the upswing again. Still, there's anticipation connected the horizon. At the opening of the 21st century, Sticky Fingers developed a enactment of market store barbecue sauces to merchantability successful astir 4,000 locations crossed the country. While these can't precisely comparison to the succulent barbecue pork ribs, smoked chicken, and pulled pork it's known for, it whitethorn beryllium capable to let the concatenation to crook itself astir erstwhile the shakedown from the bankruptcy stops rumbling.

Hardee's

Sometimes, the decease of a concatenation edifice is simply a decease by a cardinal cuts. That seems to beryllium the lawsuit with Hardee's. In 2023, 40 of the chain's locations closed. Many of them were owed to the bankruptcy proceedings of Summit Restaurant Holdings, a ample Hardee's franchisee that filed for Chapter 11. More closings followed successful 2024 and 2025.

However, it wasn't lone bankruptcy that caused fiscal woes for the company. A quality with 1 of the company's large franchisees, Paradigm Investment Group -- which owns 70-plus stores -- threatened to bubble implicit successful May of 2025. Paradigm Investment Group faced regularisation violations that included not staying unfastened until 10:00 p.m, arsenic acceptable distant successful the franchise agreement. However, Paradigm Investment Group closes some stores astatine 2:00 p.m. due to the fact that they don't person the postulation to warrant staying unfastened aft the luncheon assemblage leaves. This points to an ongoing contented with Hardee's profitability, with galore stores making lone astir $1.2 cardinal a year, per Restaurant Business Online.

Hardee's is associated with CKE Restaurants, an outfit that owns some Hardee's and Carl's Jr., 2 chains with identical colors and identical menus (thanks to a merger penned successful the precocious '90s). This enactment astir 4,000 stores nether CKE's control. Many of the woes faced by Hardee's besides endanger Carl's Jr., which volition likely, successful turn, impact Hardee's. In 2025, 20 Carl's Jr. restaurants closed successful Australia and 1 successful Texas. However, CKE Restaurants isn't publically traded, which means much closures whitethorn come, and fewer volition cognize astir them until they happen.

Bar Louie

For Bar Louie -- a concatenation that's portion accelerated casual, portion accelerated food, with drinks added for bully measurement -- Chapter 11 bankruptcy has been a solution to ongoing fiscal problems much than once. The gastrobar concatenation filed for bankruptcy successful 2020 and past again successful 2025. With betwixt 5,000 and 10,000 creditors, the concatenation has its enactment chopped retired for it if it wants to marque bully connected its extremity to support its restaurants operational during the fiscal reorganization. The 31 firm restaurants that volition stay unfastened during the Chapter 11 proceedings volition run with concern arsenic usual. Restaurants that weren't making the chopped were ousted from the company's roster earlier it had adjacent filed for bankruptcy protection.

The institution cited a mates of reasons down wherefore it needed bankruptcy extortion for a 2nd clip successful 5 years. Customers started shying distant from the edifice owed to inflation. Labor costs accrued arsenic did nutrient and inferior prices. The representation looks precise antithetic for the concatenation contiguous than it did successful 2018 erstwhile it boasted 130 stores. The institution took a downturn during the pandemic, astatine which clip it was sold to BLH TopCo during its 2020 bankruptcy. Despite lowering prices and changing up promotions based connected information investigation this clip around, the institution couldn't drawback a break.

Planet Hollywood

When it was archetypal unveiled, Planet Hollywood was expected to bash for movie nostalgia what the Hard Rock Cafe had done for stone euphony -- marque going retired to devour a quasi-spendy burger surrounded by museum-quality artifacts from popular civilization the epitome of fun. Unfortunately, arsenic with galore conception edifice chains, the clip comes for the bully happening to end. That happened erstwhile Planet Hollywood's (and sister restaurant, Planet Express) genitor company, PB Restaurants LLC, filed for Chapter 11 bankruptcy. It was the chain's 3rd bankruptcy, the different 2 being successful 1999 and 2001.

During its glory days, Planet Hollywood boasted 60 locations astir the world. The numbers present proceed to dwindle. Of those, PB Restaurants LLC operated 2 Planet Hollywood restaurants, positive the Times Square Buffet and Planet Express wrong LAX. Both the Planet Hollywood and Planet Express locations went the mode of the Dodo. When the quality of the bankruptcy broke successful the mediate of 2025, the genitor institution had a nett worthy of antagonistic $46 million.

While Planet Hollywood whitethorn beryllium the astir recognizable sanction successful the company's roster, there's a batch much connected the enactment financially than losing a fewer fast-casual restaurants decorated with depository artifacts. In all, the Planet Hollywood genitor institution has astir 500 concern locations crossed 44 states. Keeping those different properties afloat whitethorn beryllium to beryllium conscionable arsenic hard arsenic keeping its astir celebrated eateries' heads supra h2o successful the coming days.

Read the archetypal nonfiction connected Chowhound.