Pizza restaurant owners have dealt with several economic challenges since the Covid-19 pandemic which have caused financial distress requiring operators to sometimes close locations, sell restaurants, and file for bankruptcy protection.
Competition for the pizza dollar is enormous, as the number of pizza restaurants in the U.S. in 2024 amounted to over 74,000. On top of fierce competition, restaurant owners have faced rising labor and food costs driven by inflation that has cut deep into their profits.
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Food costs increased by an average of 29%, and labor costs rose by 31% from 2019 to 2024, according to the National Restaurant Association. Menu prices followed this trend, as average prices increased by 27.2% from February 2020 to June 2024.
Related: Huge burger chain franchisee files for Chapter 11 bankruptcy
Consumers have become more reluctant to eat out at restaurants as they watch their budgets in these uncertain inflationary times. Those rising menu prices are a big reason why many are staying at home and sliding a frozen pizza into the oven instead of taking a trip to the pizza parlor.
Major national pizza chain franchisees have been closing and selling restaurants, sometimes filing for bankruptcy, as well.
National pizza chain franchisees file for bankruptcy
Huge Pizza Hut franchisee EYM Pizza L.P., which at one time operated 142 Pizza Hut locations in Georgia, Illinois, Indiana, South Carolina, and Wisconsin, filed for Chapter 11 bankruptcy protection in July 2024 and sold 77 of its restaurants at a bankruptcy auction.
The franchisee said it would close another 50 locations that it was not able to sell.
Global pizza chain Domino’s largest franchisee, Domino’s Pizza Enterprises, in February 2025 said it will shut down 205 low-performing locations, which will include 172 units in Japan “to sharpen market focus and improve profitability.”
Domino’s Pizza Enterprises said it will conduct location closings from April 2025 to June 2025 and expects to save about $9.72 million annually with a one-time cost of $60.8 million.
Another Domino’s Pizza franchisee in Yorba Linda, Calif., People First Pizza Inc.,filed for Chapter 11 bankruptcy protection to reorganize its business, facing over $500,000 in disputed claims. The franchisee plans to continue operating the restaurant.
Bertucci’s Brick Oven Pizza & Pasta files for Chapter 11 reorganization.
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Bertucci’s files for Chapter 11 bankruptcy Â
Iconic East Coast pizza chain Bertucci’s Restaurants LLC, which operates 16 locations in six states, filed for Chapter 11 bankruptcy protection for the third time in seven years to reorganize its business.
Related: Popular breakfast chain franchise files for Chapter 11 bankruptcy
The debtor, which operates Bertucci’s Brick Oven Pizza & Pasta restaurants in Massachusetts, Pennsylvania, Delaware, Connecticut, Maryland, and Virginia, had 31 locations when it last filed for bankruptcy in December 2022, but has closed 15 units since the filing. Bertucci’s filed for bankruptcy the first time, seeking to sell its assets in April 2018, Nation’s Restaurant News reported.
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Earl Enterprises, the parent company of Planet Hollywood, acquired Bertucci’s for $20 million in a June 2018 bankruptcy sale. Â
The Orlando, Fla.-based debtor listed $10 million to $50 million in assets and debts, with its largest unsecured creditor, Cost Control Associates, owed over $630,000, according to its petition filed on April 24 in the U.S. Bankruptcy Court for the Middle District of Florida.
Related: Major retail food brand files for Chapter 11 bankruptcy
