This Beloved Sandwich Chain Is Trying to Save Its Locations from Closing
The coronavirus pandemic hit many chain restaurants particularly hard. With dining rooms forced to close, many didn't see enough business. Some had to shut locations down. A few even filed for bankruptcy.
One sandwich restaurant specializes in the type of customizable sandwiches that are made right in front of you saw sales fall when they had to limit restaurants to carryout and delivery only. They recently announced the closure of 100 locations. However, they seem to be fighting back.
Although 16 locations are closed for good, the total number will be less than 50, according to Nation's Restaurant News. There was speculation that they would file for bankruptcy back in June, but talks with landlords resulted in 187 lease negotiations, the company said in a statement. At that time they also hired a restriction consultant and bankruptcy attorney. They also let it be known that they didn't have a lot of cash flow.
"Our team rapidly adapted to the new operating environment," Potbelly's chief financial officer, Stebe Cirulis, said. "We preserved cash, leveraged our strong off-premise platform, innovated with new offerings, reset our real estate portfolio, and enhanced the safety of our shops for both employees and customers."
In March, 36 Potbelly locations were closed and 25% salary cuts were placed on executive and corporate employees. Sales continued to fall into the summer, even as the company hired a new chief operations officer. But while the same-store sales fell almost 70% in March, in June they were down only 20%.
Only fewer than 50 Potbelly locations will close, however, other restaurants aren't so lucky. Ruby Tuesday is permanently closing 150 locations. California Pizza Kitchen could be close to filing for bankruptcy, which will place the status of more than 250 locations in jeopardy. And hundreds of McDonald's locations are shutting down, too.
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