WFCN –
In an effort to reorganize, terminate leases, and eliminate its growing debt, another craft beer company has filed for bankruptcy, which came as a surprise.
World of Beer, a rival of Yard House, and BJ’s, both filed for Chapter 11 bankruptcy on August 2nd.
The parent company of World of Beer, WOB Holdings, and eleven other companies have petitioned the United States Bankruptcy Court for the Middle District of Florida to declare bankruptcy.
The business listed a number of reasons that contributed to this choice, such as:
The toll that increasing interest rates and leasing commitments will take on their financial resources.
Problems caused by inflation and rising operational expenses persist.
A more gradual resumption of eating habits prior to the pandemic.
According to their bankruptcy petition, the debtors’ assets and obligations were valued between $10 million and $50 million.
Synovus Bank, to which the business owes around $25.6 million, is one of the main creditors named.
The parent business of World of Beer has filed for bankruptcy protection due to mounting financial constraints caused by factors such as the ongoing epidemic, increasing prices, and shifting consumer behaviors.
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In 2007, the original World of Beer opened its doors to the public in Tampa, Florida, as a restaurant and craft beer bar.
By March 2016, the company had expanded to 75 outlets across 20 states, including a franchise in Shanghai, China, adding to its quick success over the years.
But since then, over half of the stores have shut down, leaving just 34 listed on the internet.
Fourteen stores were shuttered by the firm in the year preceding its Chapter 11 bankruptcy.
Sometimes, franchise owners were given the option to rebrand their locations rather than have them shut down entirely.
For instance, in 2017, Evan Matz renamed three of his Virginia World of Beer franchise sites Crafthouse.
The World of Beer chain’s quick expansion and subsequent substantial decline exemplify the difficulties the company has encountered in sustaining its growth and profitability in the past few years, which ultimately resulted in the bankruptcy filing.