Typically when an organization information Chapter 11 chapter, it does so with a plan as to the way it will emerge. It would typically search publicity for that plan so prospects and distributors know that there is a path ahead.
Now, any plans should be accepted by the chapter courtroom, and we have seen collectors again out of offers, distributors not keen to forgive debt, and landlords not keen to forgo again hire or decrease the hire scuttle offers.
In different instances, when an organization information, it performs it low-key. Abuelo’s, a Mexican restaurant chain with 16 places throughout seven states, opted to remain quiet. That is as a result of whereas the chain serves lots of people, its submitting truly acquired very restricted media consideration.
Now, as extra prospects appear to know concerning the plan, the corporate has determined to return ahead and make some feedback on what it expects will occur throughout its interval underneath Chapter 11 chapter safety.
Abuelo’s Chapter 11 chapter submitting overview
- Date Filed: September 2, 2025
- Court docket: U.S. Chapter Court docket, Northern District of Texas
- Case Quantity: 4:25-bk-43339
- Choose: Edward L. Morris
- Belongings & Liabilities: Between $10 million and $50 million
- Collectors: Between 200 and 999
- Guardian Firm: Meals Ideas Worldwide, L.P. (FCI)
Supply: Inforuptcy
Abuelo’s shares its Chapter 11 chapter plans
Abuelo’s has each a weblog and an FAQ on its web site. Neither mentions the chain’s Chapter 11 chapter submitting.
In truth, for those who simply go to the web site, you’ll assume that nothing has occurred. The corporate does, in fact, share a few of its historical past.
The story of Abuelo’s begins in the summertime of 1989, when entrepreneurs James Younger, Chuck Anderson and Dirk Rambo opened the primary Abuelo’s Mexican restaurant in Amarillo, Texas. Our founders’ aim was easy. To open a restaurant serving scrumptious, made-from-scratch genuine Mexican meals at on a regular basis costs, in addition to to create a spot the place friends of all ages might come collectively to expertise the distinctive flavors, together with the artwork and tradition of Mexico. What got here to life was a really distinctive eating expertise – genuine tastes of Mexico, with family-style eating in an elevated, but snug setting.
The chain’s house owners did, nonetheless, lately share their plans to remain in enterprise with the Lubbock Avalanche-Journal.
“Lubbock remains part of our story and we will always be open here, furthering our dedication to serving the local community and our customers. We are honored by your continued dedication and are looking forward to an even brighter future together,” the corporate stated in an announcement.
Extra Eating places:
- Cracker Barrel closing 14 company-owned eating places amid backlash
- Beloved sandwich chain closes eating places, bakeries
- Restaurant chain closed 50% of places in Chapter 11 chapter
Abuelo’s additionally has places in Abilene, Amarillo, the Dallas-Fort Value area, and Midland and in a number of different states.
“At the moment, operations are expected to continue throughout the company’s locations,” in response to the assertion.
The chain, in response to courtroom filings, hopes to not shut any of its eating places. All have remained open thus far through the chapter course of.
Abuelo’s hopes to maintain all of its remaining places open.
Picture supply: Shutterstock
Abuelo’s faces monetary difficulties:
- Declining Gross sales: The chain skilled a 15.4% drop in gross sales between 2023 and 2024.
- Financial Pressures: Inflation, decreased client spending, labor shortages, and elevated wage pressures negatively impacted operations.
- Excessive Climate: Warmth waves in the summertime of 2024 led to 63 retailer closure days and over $500,000 in misplaced income.
- Shift in Shopper Habits: A 7.7% improve in out-of-store gross sales was offset by a decline in in-store visitors, affecting beverage and tip income
Supply: Nation’s Restaurant Information
Abuelo’s has been shrinking
Meals Ideas Worldwide shared the next on its LinkedIn web page.
Meals Ideas Worldwide (FCI), based mostly in Lubbock, Texas, owns and operates 40 Abuelo’s Mexican eating places in 15 states all through the US. FCI has been in enterprise since 1975. Abuelo’s has acquired nationwide accolades because the top-ranked Mexican meals restaurant, one in all America’s high chains, and for providing nice meals for lower than $20.
That is greater than double the restaurant depend the chain had on the time of its Chapter 11 chapter submitting.
“Abuelo’s blamed the bankruptcy on a big drop in sales, rising food and labor costs, continued staffing challenges, and changes in consumer preferences. The chain began seeing headwinds in 2023, stemming from inflation and a drop in guests’ willingness to spend money on dining out,” FSR Journal reported.
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