A Struggling Mediterranean Restaurant Chain Is the Latest to Declare Bankruptcy
This year has been rife with bankruptcies in the restaurant world, with Red Lobster, Buca di Beppo, and Tijuana Flats among the major chains impacted by the trend. And late last week, a struggling Mediterranean chain based in the Midwest became the latest to declare bankruptcy in 2024.
Roti—a Chicago-based fast-casual brand that serves a variety of bowls, salads, and pita wraps—announced on Aug. 23 that it had filed for Chapter 11 bankruptcy protection. In a statement, CEO Justin Seamonds attributed the decision to a variety of financial issues.
"Our vision to create happier, healthier, and more flavorful lives comes to life by providing our guests with exceptional food experiences—even in the face of current headwinds. After careful consideration, filing for bankruptcy protection was the best way to address our challenges—including financial performance, higher costs, mixed location performance, and tough market conditions—while staying open and focused on delivering Food For A Full Life to each and every guest," he said, referencing Roti's "Food For A Full Life" slogan.
Though Technomic data shows that Roti was one of the fastest-growing restaurant chains before the COVID-19 pandemic, its sales and size have been on the decline in recent years. Its website currently lists 19 restaurants in operation, which is about half of what it had before the pandemic, Restaurant Business Magazine reported. Just last year, Roti shuttered four of its restaurants and also saw its systemwide sales drop by a notable 12%.
The chain said it intends to use the Chapter 11 bankruptcy filing to seek new investors or a buyer and reorganize its finances while working to keep its remaining locations open. Roti also plans to continue offering its full menu, loyalty programs, and catering at its restaurants, which are located across Chicago, Minneapolis, and Washington, D.C.
"With the restaurant industry in turmoil, we are proud of our transparency with our team, and the goodwill we've earned over time with our vendor and landlord communities during a tough four years," Seamonds said. "Bankruptcy is a process designed to provide companies like us with the tools to stay open, keep our exceptional team members employed, and explore future prospects for Roti. We expect our loyal, flavor-seeking guests to continue to enjoy us while we tackle this necessary next step in our journey."
Consumers shouldn't be too surprised if additional restaurant chains file for bankruptcy before the end of the year. BurgerFi recently hired a chief restructuring officer, the latest sign to indicate that bankruptcy may be on the horizon for the struggling gourmet burger chain. Citing anonymous sources, Bloomberg also reported last month that Mod Pizza was preparing a potential bankruptcy filing. However, the sources said the company had yet to make a final decision and its plans could change.
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