Beloved Mexican restaurant chain Abuelo's goes bankrupt and shuts down more than half of its stores

Abuelo’s, the Mexican restaurant in the family style that has been serving Enchiladas and Fajitas for 36 years, has applied for bankruptcy protection. The move follows years of falling sales, rising costs and a shrinking footprint in the US, reports Pennlive.com. At its peak, Abuelo operated 40 restaurants nationwide. Today, only 16 remain open. The company, owned by Food Concepts International, has quietly lodged with the US Bankruptcy Court for the Northern District Texas. Court documents show that debt and liabilities between $ 10 million and $ 50 million are estimated. Food Concepts International also applied for bankruptcy last month, and the two companies asked the court to merge their cases. “Strategic restructuring,” Abuelo’s’ says this decision is part of a strategic reconstruction process to strengthen our financial position in the long run, “Abuelo said in a statement shared with restaurant companies. “We will continue with normal operations and remain committed to maintaining stability for our employees, sellers and customers. Through this time, our loyal customers can join us and expect the same quality and hospitality as we have always provided,” the statement further states. The chain insists that it does not completely shut down. But the decision indicates how tough the casual dining sector has become – especially for local brands. According to FSR magazine, the decline began years ago, traffic at Abuelo’s restaurants fell almost 6% in 2023, and the slide continued in 2024. The company responded by shutting down weaker stores and cutting overhead. Still, that wasn’t enough. Chron reported that the brand had a 15% decline last year, along with food and labor costs. Staff shortages added more pressure, and extreme summer heat in 2024 forced several temporary closures, which cost about $ 500,000 in lost income. Established in Amarillo, still in seven states, Abuelo’s started in 1989 in Amarillo, Texas, known for his dining room in the courtyard style and of the dishes. The chain is still in Arizona, Arkansas, Florida, Kansas, Oklahoma, South Carolina and Texas, reports Cleveland. For loyal fans, the company says the company will continue as usual – at least for now. Questions 1. Why did Abuelo’s Bankruptcy file lie? Due to falling sales, higher costs and continuous staff shortages. 2.. How many Abuelo’s locations are still open? Sixteen locations remain over seven US states. 3. Will Abuelo close all its restaurants? No, the company says it will continue with normal operations during restructuring. 4. When was Abuelo founded? It was founded in 1989 in Amarillo, Texas.