A large Wendy’s franchisee, named Starboard Group LLC, becomes the latest in a string of fast food franchisee’s filing for bankruptcy in the past few months. Starboard has a total of 73 Wendy’s locations, and 15 Subway Sandwiches being operated in numerous states.
Starboard operates in Florida, Alabama, Illinois, Missouri, Louisiana, Wisconsin and, Texas. The company has an estimated asset amount of $1 billion to $10 million. An additional two locations under the same franchisee closed before the filing recently.
Andrew Levy, the CEO with Starboard Group LLC, said on the matter:
The reason cited behind the bankruptcy is “post-COVID consumer habits, ever-increasing costs to do business, and significantly higher interest rates”.
They were losing an estimated $1.5-2 million annually. Wendy’s CEO, Levy continued:
“Wendy’s is not alone in suffering from financial difficulties during this same time period. Burger King and other fast-food retailers across the country have also continued to suffer, and other franchisees and franchisors have closed stores or filed Chapter 11 to restructure their operations.”
Burger King has been making headlines recently with a chain reaction of franchisee’s filing for bankruptcy from September, to late October. CEO, Josh Kobza announced that an approximate count of 400 locations would be shutting down by the end of the year to make way for the focus to lie on franchisees that run with the standards of parent company Yum! Brands.
The CEO for Wendys implied that there would be more closures coming down the pipeline.
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