A POPULAR Italian restaurant and Olive Garden rival only has a handful of locations remaining after filing for bankruptcy for the third time since 2018.
Financial pressures pushed Bertucci’s to file for Chapter 11 in late April as foodies saw the chain conduct a series of closures to mitigate losses.
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Founded in 1981, Bertucci’s is an Italian chain known for its brick oven pizza and pasta.
A rival to Olive Garden and Maggiano’s, the chain has struggled to stay afloat in the competitive restaurant industry.
Before its most recent bankruptcy filing on April 24, Bertucci’s closed seven underperforming locations to mitigate losses, including five in Massachusetts, one in Rhode Island, and one in Maryland.
The company hopes that the bankruptcy process will provide Bertucci’s with a “breathing spell” so it can “determine the best path forward and formulate an overall reorganizational plan,” it shared in the filing.
Bertucci’s attributed its third bankruptcy to a slew of factors.
“With losses accumulating, inflationary pressures still high, and industry headwinds gusting, the proverbial final straw fell on [Bertucci’s] this year as the world saw food costs soar, consumer spending slow, and an uncertain global economy falling in (and out) of decline,” said the company.
Bertucci’s struggles over the years have culminated in three bankruptcy filings and a string of closures, leaving the chain with just 15 locations:
Massachusetts
- Boston
- Chelmsford
- Chestnut Hill
- Framingham
- Hingham
- Medford
- Newton
- Reading
- Waltham
- Westborough
Maryland
Connecticut
Delaware
Pennsylvania
Virginia
SALTY STUGGLES
Bertucci’s was founded over four decades ago by Italian immigrant Joseph Crugnale.
How does bankruptcy work?
Bankruptcy is a specific legal process that helps companies eliminate debt they can’t repay.
The process allows businesses to start fresh and gain access to new credit.
Supervised by federal courts, bankruptcies allow a company to sell off its assets more easily to pay off creditors, according to Investopedia.
Chapter 11, a common process for companies, is used to restructure a business with the goal of remaining open – even if it means selling off most of the company’s properties.
Chapter 7, on the other hand, sells all of a company’s assets, putting it out of business.
Chapter 15, alternatively, allows for collaboration between American and foreign courts to conduct bankruptcy proceedings with “parties of interest involving more than one country,” per the United States Courts.
By 1989, the restaurant chain had been ranked as one of the top 10 pizza spots in America by USA Today.
The Massachusetts-based business quickly grew in popularity among foodies, expanding to roughly 100 locations by the end of the 2000s centered along the East Coast.
Bertucci’s, however, has seen a sharp decline in its success over the years as pressures have mounted.
Due to increased competition from fast-casual chains, a saturated restaurant market, and weakening consumer demand, Bertucci’s declared bankruptcy and shut down 15 restaurants in April 2018.
Then in December 2022, the Italian chain filed for Chapter 11 bankruptcy a second time, further dropping its restaurant count to just 23 locations.
Bertucci’s cited troubles stemming from the COVID-19 pandemic, including the nationwide shutdown and high inflation.
Despite the chain’s third bankruptcy filing last month, Bertucci’s hopes to successfully reorganize its business for a sustainable and successful future.
A bankruptcy filing does not always mean that a business is doomed.
For example, a popular restaurant brand has set out to save On The Border after its bankruptcy filing, planning a massive menu takeover.
Plus, another beloved restaurant chain has made a triumphant return after filing for bankruptcy over two decades ago.
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