According to an article in Forbes, a franchisee of 56 Dunkin Donuts restaurants has filed for Chapter 11 bankruptcy due to an extreme decline in sales revenue and massive debt obligations.
The article said:
“The franchisee, Kainos Partners Holding Company LLC of Greer, S.C., operates 56 Dunkin’ Donuts locations in New York, South Carolina and Nevada and employs about 700 people, according to court documents filed Monday in the U.S. Bankruptcy Court in the District of Delaware. The company also has eight stores under construction. In the filing, the company said it owed between $10 million and $50 million and had $10 million to $50 million in estimated assets.”
According to bankruptcy court documents the franchisee faced a rapid decline in sales due to consumer cutbacks and faced rising food costs that is making it impossible to meet its debt obligations. The bankruptcy comes on the heels of several Chapter 11 bankruptcies in the restaurant industry which has been negatively impacted by the recession.
Chapter 11 bankruptcy has been a powerful tool for restaurant companies and other industries such as the automotive industry to restructure their debts and emerge from bankruptcy viable. But Chapter 11 bankruptcy isn’t just for large corporations, it can also help sole-proprietors or small businesses restructure their debts and emerge profitable. To find out more about Chapter 11 bankruptcy, contact a Dallas-Fort Worth bankruptcy attorney today.