Fourth US Italian restaurant chain files for bankruptcy this year

Another Italian restaurant chain has filed for bankruptcy this week and will be shuttering underperforming locations as a result, becoming the latest victim to the challenges facing the U.S. dining sector.

Bravo Brio Restaurants, owner of the upscale Italian chains Bravo! Italian Kitchen and Brio Italian Grille, filed for Chapter 11 protections. The company said this was the result of weak demand and rising costs which it described as “insurmountable” pressures on the industry.

Newsweek contacted Bravo Brio’s parent company, Earl Enterprises, via email for comment outside of regular hours on Thursday.

Why It Matters

Bravo Brio’s decision follows several other well-known Italian restaurant chains filing for bankruptcy this year. Beyond the individual company challenges and job losses these could entail, this wave serves as yet another indication of financial pressures within the U.S. food industry. These have been seen across upscale, fast-casual and fast food establishments, who are grappling with weakened consumer confidence and a resulting drop in spending.

What To Know

In a statement sent to Restaurant Dive, the company cited macroeconomic headwinds, including declining demand and rising competition, as the reasons behind its decision to seek Chapter 11 protections. Bravo Brio previously filed for bankruptcy in 2020, exiting the process months later after being acquired by Earl Enterprises.

In its Monday filing, the company said it had between 200 and 999 creditors, as well as assets and liabilities both estimated to be in the $50 million to $100 million range.

Bravo Brio is only the latest Italian dining chain to seek bankruptcy protections amid mounting financial difficulties in the restaurant sector. People First Pizza filed for bankruptcy in March, followed by Bertucci’s in April and Red Door Pizza last month.

At least one of the chains, Bertucci’s, has already begun closing restaurants following this move, according to CBS News.

Bravo Brio, quoted in Nation’s Restaurant News, said that the Chapter 11 process would provide an opportunity to restructure the business for “a sustainable and successful future, including closing underperforming locations, restructuring debt, and streamlining and reducing operational expenses.”

What People Are Saying

Bravo Brio Restaurants, in a statement shared with Restaurant Dive, said that the pressures facing the food industry “have proved insurmountable to numerous other legacy, casual dining restaurant brands, many of whom have also turned to bankruptcy as a tool for restructuring.”

A Bertucci’s bankruptcy court filing, as quoted by Fox Business, read: “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.”

Bertucci’s added that the filing would allow it to “determine the best path forward and formulate an overall reorganizational plan.”

What Happens Next?

Following its filing, according to Restaurant Dive, Bravo Brio plans to seek new investors and aims to emerge from the Chapter 11 process on a stronger financial footing.