Pizza restaurant chains have faced plenty of financial distress over the last year from economic issues, such as lingering effects from the Covid-19 pandemic, a spike in interest rates, and higher labor and food costs caused by rising inflation.
The financial drain from these issues cuts deep into revenues and impacts the thin margins pizza restaurants already face, making it more difficult for these businesses to be profitable.
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After making as many operational cuts as possible, some pizza businesses are forced to close or sell restaurants and sometimes file for bankruptcy to facilitate their options under court protection.
Related: Bankrupt pizza chain operator unloads dozens of locations
EYM Pizza, which operated Pizza Hut locations in Georgia, Illinois, Indiana, South Carolina, and Wisconsin, filed for Chapter 11 bankruptcy protection on July 22 in the Eastern District of Texas, seeking to sell its assets.
The debtor, which once owned 142 Pizza Hut franchise locations, sold 77 of its restaurants in Georgia, Illinois, South Carolina, and Wisconsin to six separate bidders, including Yum Brands (YUM)  franchisor Pizza Hut LLC.
The franchisee closed 15 of its locations in Indiana and Ohio in July 2024 before filing for bankruptcy and will end up closing another 50 locations that it has not been able to sell.
Some Marco’s Pizza locations also have faced financial distress in recent months, forcing franchisees to file for bankruptcy.
Marco’s Pizza franchisee has four underperforming locations
Tampa Bay Marco’s Pizza franchise owners Terry Burkholder and Ben Finley, who owned 19 locations, filed for Chapter 11 bankruptcy in November 2024 to reorganize and sell underperforming restaurants, Tampa Bay Business Journal reported.
The franchisee reportedly purchased four underperforming stores at the encouragement of Marco’s Pizza’s corporate office, but they became a drain on the franchise group. The debtor said it plans to sell the four locations as part of the reorganization.
The debtor also needed to restructure merchant cash advance loans that had become a financial burden.
Marco’s Pizza has about 1,100 locations in 33 states.
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Marco’s Pizza operator files for Chapter 11 bankruptcy
Finally, the franchisee of Marco’s Pizza locations in Austin and Round Rock, Texas on Feb. 3 filed for Chapter 11 bankruptcy to reorganize its businesses.
Related: Popular beverage brand files for Chapter 11 bankruptcy
Debtor Triple TWK Inc. listed up to $50,000 in assets and $500,000 to $1 million in liabilities in its petition.
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The company’s largest unsecured creditors include Security State Bank & Trust, owed $249,000; Kalamata Capital, owed over $144,000; CFS CAP LLC, owed over $72,000; Forward Financing, owed over $55,000; and American Express, owed over $54,000.
Kalamata Capital, CFS CAP, and Forward Financing are merchant cash advance lenders that provide short-term financing.
The petition said that funds would be available to distribute to unsecured creditors. The company will operate its restaurant locations during the reorganization process, according to an RK Consultants X post.
The debtor listed its principal place of business in Round Rock and a franchise in Austin.
Top restaurant bankruptcies in 2024.
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A franchisee affiliate, Double KÂ Ah!htentic Pizza, which lists the same principal place of business in Round Rock, filed a separate Chapter 11 petition to reorganize on the same date.
Double K listed $100,000 to $500,000 in assets and $1 million to $10 million in liabilities in its petition.
The debtor’s largest unsecured creditors include Security State Bank & Trust, owed over $497,000; Ascentium Capital, owed over $247,000, and Kalamata Capital, owed over $144,000. The debtors also owe payments to several tax authorities.
Triple KWK and Double KÂ Ah!thentic Pizza list the same bankruptcy counsel, The Lane Law Firm. There was no indication if there would be a joint administration of the cases.
Marco’s Pizza, which was founded in 1978, has about 1,100 locations in 33 states, according to its website.
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