A POPULAR Mexican restaurant chain has closed two dozen locations after it filed for bankruptcy.
Abuelo’s once had 40 restaurants across the US, but narrowed that down to just 16, which left diners with fewer options.
Abuelo’s filed for bankruptcy in September (stock)[/caption]
The chain filed for chapter 11 protection in a US Bankruptcy Court in Texas last month.
Chiefs at Abuelo’s cited a range of reasons for the decision, including declining sales and shifting consumer spending habits.
Bosses also highlighted problems like rising operating costs and staffing challenges.
Abuelo’s parent company, Food Concepts International, was also forced to file for bankruptcy last month.
The restaurant chain told the outlet Restaurant Business in a statement that it had slashed its location count to streamline its operations.
A spokesperson for the chain said: “This decision is a part of a strategic reconstructing process to strengthen our long-term financial position.
“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.”
SLIPPING SALES
Abuelo’s has been in business for over 30 years, but in 2024, its restaurant count dipped below 20.
It then plummeted to 16 spots across eight US states, in Arizona, Arkansas, Florida, Kansas, Oklahoma, South Carolina and Texas.
Court documents revealed that Abuelo’s was in millions of dollars of debt.
Chiefs are currently working to clear the burden, which sits between $10 million and $50 million.
Abuelo’s had been struggling for a few years and saw a 15.4% dip in sales between 2023 and 2024.
BAD TIMING
The chain filed for bankruptcy just two weeks after it brought back its Catch the Queso deal.
BRANDS HARD HIT BY BANKRUPTCIES
Many chains have struggled to adapt to a post-Covid retail landscape, with several companies filing for bankruptcy
JoAnn Fabrics and Crafts announced it would close all 800 stores after filing for bankruptcy twice in a year.
Hooters announced plans to file for Chapter 11 bankruptcy protection in February.
Liberated Brands announced that it would be closing all 122 retail locations for its boardsport fashion brands Quiksilver, Billabong, and Volcom.
Forever 21 shut down its headquarters after filing for bankruptcy and laying off 358 employees.
Macy’s announced major restructuring plans amid mass store closures.
Abuelo’s is still running the promotion at its remaining locations, however, through September 21.
Diners are encouraged to snap up small promotional balls at community events.
These balls will then get diners a free side of chile con queso when returned to restaurants.
And despite the closures, Abuelo’s is still gearing up to celebrate its Abuelo’s Day promotion on September 7.
Diners will be able to get empanadas and draft beers for just $5 each.
HIGH PRAISE
Abuelo’s has been receiving high praise on social media from customers, even with the decline in sales.
One person wrote on Facebook in July that she loved the food and recommended it.
She said: “Great food and service. Thanks Abuelo’s Mexican Restaurant. I would give them 10 stars.
“Their rice and beans actually had flavor was not bland at all like some restaurants are. So if you haven’t tried them please do.”
Chiefs at Abuelo’s cited a range of reasons for the decision, including declining sales and shifting consumer spending habits[/caption]
