Dive Brief:
- Shari’s Restaurant has closed all of its restaurants in Oregon, according to multiple media outlets. The restaurants closed Sunday, Oct. 20, per a letter to employees shared on social media.
- The casual chain, which once had nearly 100 restaurants across six states, had 42 locations in Oregon at the beginning of this year, according to OregonLive.
- The chain has faced significant financial difficulties, including unpaid bills, back taxes and evictions. Earlier this year, it closed at least seven restaurants in Washington and Idaho, according to local news outlet KGW.
Dive Insight:
Several vendors have complained about unpaid bills, including a marketing agency and property owners, and Shari’s Management Corporation had six liens against it by the Idaho State Tax Commission for nearly $220,000 in unpaid taxes, per KGW.
According to a letter to employees written by Sam Borgese, sole managing member of parent company Gather Holdings Guarantee, the company underwent “extensive and exhaustive efforts,” but could not find a different outcome other than the closures.
The letter to employees did not give a reason for the closures, but the chain has had supply issues in addition to its various financial challenges. One of its stores in Beaverton, Oregon, ran out of its quintessential pies while other customers have complained about some menu items not being available.
OregonLive estimated that the chain is down to about 17 units. Shari’s restaurants in California, Washington and Idaho were open as of Monday.
MGG Investment Group invested an undisclosed amount of money in the Oregon restaurant locations last year. The new capital was expected to help these locations continue to recover from the challenges associated with the COVID-19 pandemic. MGG also provided knowledge of video lottery gaming operations to Shari’s, which has been a longtime lottery retailer, per a press release. Shari’s still owes the Oregon Lottery over $900,000, according to OregonLive’s reporting.
Shari’s isn’t the only casual chain facing closures and ongoing financial difficulties as traffic declines and rising costs persist. TGI Fridays could be considering bankruptcy after a failed merger. Earlier this year, bondholders seized control over portions of the company’s business, including its whole business securitization. Hooters, Bloomin’ Brands and TGI Fridays have closed restaurants this year while World of Beer, Red Lobster, Buca di Beppo declared bankruptcy.
