Economic problems that casual restaurant chains faced in 2024 are still forcing dining businesses into financial distress in 2025.
Increased labor and food costs caused by inflation have cut into profits, forcing restaurants to raise prices that can sometimes discourage patrons from dining. Rising interest rates have also increased the cost of debt for companies, reducing profits.
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The solution for several restaurant chains has been to close underperforming or unprofitable locations, launch out-of-court restructurings, or maybe file a Chapter 11 or Chapter 7 bankruptcy.
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Fast-casual Mexican chain Tijuana Flats on April 19, 2024, filed for Chapter 11 bankruptcy, closed 11 of its locations and sold the company to a new ownership group. It emerged from bankruptcy in January 2025.
The company said that the sale and bankruptcy filing was the result of a strategic review that it began in November 2023 seeking options to improve its business.
Italian restaurant chain Buca di Beppo on Aug. 4 filed for Chapter 11 bankruptcy protection seeking to reorganize after closing 13 underperforming locations in the week before it filed for bankruptcy.
The company asserted that the chain’s operations had been impacted by a significant drop in sales, rising food and labor costs, continued staffing challenges, and changes to customers’ dining preferences.
Top restaurant bankruptcies in 2024.
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The company, which had 44 remaining locations in 14 states after the closings, sold its remaining assets to its prepetition lender Main Street Capital Corp. for a $27 million credit bid.
Iconic restaurant chain TGI Friday’s Inc. filed for bankruptcy protection on Nov. 2, 2024, seeking to reorganize its business, sell certain company assets, further reduce its restaurant footprint, and reject unfavorable leases and contracts.
TGI Friday’s filed motions on Jan. 28, 2025, to sell 18 of its remaining restaurants and close its other 12 remaining locations that lacked interest from potential buyers.
Fast-casual restaurants file for bankruptcy Â
Smaller fast-casual chains are struggling to stay afloat as well. Rising costs from inflation and consumers tightening their belts in an uncertain economy are reducing profits and creating financial distress for certain restaurants.
Fast-casual chain The Biscuit Bar filed for Chapter 11 protection to reorganize its business, facing financial distress.
The Plano, Texas-based restaurant chain filed its petition on Feb. 6 in the U.S. Bankruptcy Court for the Northern District of Texas to restructure the debts of its six biscuit sandwich restaurants.
The Biscuit Bar, which operates restaurants in Abilene, Coppell, Dallas, Fort Worth, North Arlington, and Plano, Texas, listed $50,000 to $100,000 in assets and $1 million to $10 million in debts in its petition.
Greenleaf Kitchen & Cocktails files for Chapter 11 bankruptcy.
Image source: Shutterstock
Greenleaf Kitchen files for Chapter 11 bankruptcyÂ
And now popular healthy gourmet restaurant chain Greenleaf Kitchen & Cocktails filed for Chapter 11 protection on Feb. 18 to reorganize its business.
Related: Formerly bankrupt Mexican chain turns heads with major change
The Los Angeles-based casual restaurant chain listed $500,000 to $1 million in assets and $1 million to $10 million in liabilities in its petition.
More bankruptcy:
Popular breakfast dining chain files for Chapter 11 bankruptcyHuge national car wash chain files Chapter 11 bankruptcyTroubled trucking company files for Chapter 11 bankruptcy
 The debtor Greenleaf 2 CPE and two affiliates, Greenleaf 4 SOCO and G7 Venice, reported that funds would be available for distribution to unsecured creditors.
The roots of Greenleaf date back to 2007 when founder Jon Rollo opened his first Greenleaf Gourmet Chopshop in Beverly Hills, Calif.
Greenleaf’s website currently lists five locations, two in Los Angeles, two in Costa Mesa, Calif., and a location at USC Village in Los Angeles that closed in early January, according to an Instagram post.
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