The fast-food industry faces another shock as a prominent Del Taco franchisee has filed for bankruptcy, jeopardising 22 locations across the US. The franchise group, which operates under the name Sizzling Platter, cited insurmountable cash flow problems as the primary reason for the Chapter 11 filing.
Financial Struggles Hit Hard
Court documents reveal the franchise has been battling financial difficulties for months, with rising operational costs and declining sales creating a perfect storm. The bankruptcy filing lists liabilities between $10 million and $50 million, with assets in the same range.
Employee and Customer Impact
While the company insists all locations remain open during restructuring, industry experts warn that closures could be imminent if a buyer isn't found quickly. Employees at affected restaurants face an uncertain future, with potential job losses looming.
Broader Industry Trends
This development comes as the fast-food sector grapples with multiple challenges, including:
- Rising ingredient costs
- Increased labour expenses
- Changing consumer preferences
- Intense competition from newer chains
The Del Taco corporate office has yet to comment on whether they will step in to support the struggling franchise locations or seek alternative operators.
