According to a recent report by Bloomberg, Hooters is poised to file for bankruptcy as part of a strategic restructuring of its operations. The casual dining chain has been collaborating with creditors to navigate its financial difficulties.

Financial Dilemma Intensifies

The Atlanta-based restaurant chain is reportedly seeking assistance from the law firm Ropes & Gray to facilitate the bankruptcy filing process. Although no definitive decision has been made regarding Chapter 11 protection, sources indicate that a filing could occur within the next two months.

Recent Closures and Industry Challenges

In June 2024, Hooters shuttered numerous underperforming locations across the United States as part of its efforts to mitigate losses. The franchise, which has struggled amidst rising inflation and evolving consumer preferences, has seen a significant reduction in its footprint. Since 2018, the chain has observed a 12% decrease in its total number of establishments, dropping from 333 locations to just 293 by the end of 2023, according to data from restaurant consulting firm Technomic.

Conclusion

As Hooters prepares to potentially file for bankruptcy, it joins a growing list of restaurants grappling with the pressures of a challenging economic landscape. The restaurant’s attempt to restructure its operations highlights the ongoing transformations within the casual dining sector.