Bennigan's, Steak and Ale To Liquidate as Glutted Restaurant Industry Shakes OutThis is bad in so many ways. While I am no fan of big chains the 9,000++ folks that just lost their jobs are going to be hit hard. Students, struggling families, these are the folks busting their asses for minimum wage. And according to the story staff were given no notice at all of the shut down.
After filing for Chapter 7 bankruptcy, the parent company of national chains Bennigan's and Steak and Ale on Tuesday shut hundreds of restaurants, putting thousands of employees out of work.
The filing marked one of the largest Chapter 7 bankruptcies of a restaurant chain in recent history, according to restaurant consultancy Technomic, and is the most extreme sign yet of how midprice, sit-down restaurants are undergoing one of their worst periods in decades. Challenger, Gray & Christmas says the resulting layoffs constitute the sixth-largest mass job cut of the year.--JEFFREY MCCRACKEN and JANET ADAMY
Bennigan's, owned by privately held Metromedia Restaurant Group, collapsed in a particularly dramatic fashion Tuesday. Managers of restaurants across the country were awakened by midnight phone calls telling them to shutter their stores immediately, according to interviews with several restaurant managers.--By Michael HughlettThat part pisses me off even more. No chance to go try to find other work. No warning at the end of the month with rent due and bills to pay. I know in my restaurant this year has been tough. But my staff and I are working together to get the company and ourselves through difficult times. I wonder if Bennigan's had more respect for their employees and communities-- they might have been able to avoid this liquidation?
Anyway, this is just the beginning. As I mentioned in an earlier post, the F&B business is the canary in the coal mine during a bad economy. People struggling to pay bills, or in danger of losing their homes are going to stop eating out as a first line of defense. And so the dominoes begin to fall.