It once had 40 stores across the U.S., but it is now down to just 16 locations.
And as a result, the restaurant chain filed for bankruptcy.
Abuelo’s — a Mexican eatery that has been around for 36 years and is owned by Food Concepts International — quietly made a filing in a U.S. Bankruptcy Court located in the Northern District of Texas recently. The chain cites sales declines, rising costs, staffing challenges and changing consumer preferences.
It also listed both debts and liabilities of between $10 million and $50 million.
Meanwhile, Food Concepts International also filed for bankruptcy in early September, and the two companies have asked the court to combine their cases.
“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.”
Per FSR Magazine, the chain has found itself struggling for several years as the challenges began in 2023, with traffic dropping 5.9% that year and persisting into 2024. To solve the issue of the decrease in sales, Abuelo’s closed underperforming stores and slashed overhead costs.
Abuelo’s currently operates stores across Arizona, Arkansas, Florida, Kansas, Oklahoma, South Carolina and Texas.
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