One Of America's Largest Bakery Chains Could Be Headed for Bankruptcy
Bakery chains catering to urbanites have had a particularly rough year. With the morning foot traffic from commuters abruptly declining at the start of the pandemic, and a significant number of Americans transitioning to making breakfast at home, these types of businesses have seen devastating drops in sales. (To find out which restaurants may be leaving your town, check out 9 Restaurant Chains That Closed Hundreds of Locations This Summer.)
For example, Le Pain Quotidien and Maison Kayser, two chains catering to city workers with breakfast and lunch options, were bought out of bankruptcy and saved from a grimmer fate through an acquisition by Aurify Brands, while Pret a Manger was forced to close up shop in two major cities. The latest to join the list of bakeries in trouble is Corner Bakery Cafe, third highest-grossing bakery cafe chain in the US, with 175 locations in more than 20 states.
According to Restaurant Business, the chain is making moves to restructure their debt, which includes exploring a sale of the business, due to steep declines in revenue since the start of the pandemic. While the company may be able to avoid a bankruptcy filing with the help of restructuring and financial advisors, their losses in urban areas are forcing the company to start considering various financial alternatives.
The chain is still very much serving customers, and so far there has been no mention of closing locations. Recently, they added two new items featuring popular meat alternatives to their menu—the Beyond Meatball Panini and Beyond Meatball Linguine—and brought back seasonal limited-time goodies like bundt cakes and coffee drinks featuring fall flavors.
One of the biggest hurdles for Corner Bakery Cafe and others like it is the fact that foot traffic in urban areas may take a while to recover, since Americans will largely keep working from home for the foreseeable future, and some even for good. As our workforce is shifting to digital, brick-and-mortar-reliant chains will need to implement significant changes to their businesses to adjust.
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