A popular Mexican restaurant chain that once held a promising future with 40 stores across the U.S., has filed for bankruptcy and downsized to just 16 locations.
Abuelo’s, a 36-year-old restaurant chain, owned by Food Concepts International, filed for bankruptcy earlier this month in the U.S. Bankruptcy Court for the Northern District of Texas.
The chain listed assets and liabilities between $10 million and $50 million, court filings show.
Likewise, Abuelo’s parent company Food Concepts International filed for bankruptcy in early September and has asked that the cases be combined.
“This decision is a part of a strategic reconstructing process to strengthen our long-term financial position,” Abuelo’s said in a statement obtained by Restaurant Business.
“We will continue normal operations and remain committed to maintaining stability for our employees, vendors and customers. Through this time, our loyal customers can join us and expect the same quality and hospitality as we’ve always provided.”
According to FSR Magazine, the chain has struggled for several years now.
The company attributed the filing to a drop in sales, rising food and labor costs, and a change in consumer interests.
FSR reports these challenges started arising in 2023, with traffic dropping 5.9% that year and persisting into 2024. The outlet reports Abuelo’s combatted the drop in sales through closing underperforming stores and cutting overhead costs.
Abuelo’s operates stores across Arizona, Arkansas, Florida, Kansas, Oklahoma, South Carolina and Texas.
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