A major Hardees franchisee has filed for bankruptcy after 39 of its 108 restaurants across America have been forced to close.
Amid inflating food and labor costs and a pandemic-fueled loss in foot traffic, a fleet of Hardees restaurants owned by Summit Restaurant Holdings could be set to shutter amid the company's plummeting bottom line.
At its height, the business controlled 145 Hardees locations across the nation, but it has joined a growing number of firms to hit turbulent financial times.
Summit, which is owned by fast-food franchise Carls Jr. parent company CKE Restaurants, is now seeking a buyer to try and keep its remaining 108 restaurants afloat.
The affected locations are spread across America, with Summit's Hardees stores found in Alabama, Florida, Georgia, South Carolina, Kansas, Missouri, Wyoming and Montana.
Summit Restaurant Holdings, which owns over 100 Hardee's stores nationwide, pointed to rising transport, food, and labor costs for its demise
Faced with a dim economic outlook, the Hardee's franchisee has already shuttered 39 of its restaurants as a desperate cost-cutting measure.
The move failed to save the doomed locations, however, and Summit filed for Chapter 11 bankruptcy last week.
According to documents filed with the Colorado Bankruptcy Court, the business has assets in the region of $1 million and $10 million, and debts between $10 million and $50 million.
The business reportedly blamed rising transport, food, and labor costs for its demise, alongside mounting rent for its numerous stores.
Hardee's owns 1664 locations across America, according to its website, and those not owned by Summit are not affected by the bankruptcy filing.
The company will reportedly use the bankruptcy period to find its new buyer, and it insists its remaining stores will remain open 'as usual'.
In a statement following the bankruptcy filing, CKE Restaurants told DailyMail.com: '(The) goal is to maintain the maximum number of stores continuing to operate, backed by a capital structure that is sustainable and poised for long-term growth and success, and we are working with all parties to achieve that goal.
'Hardee’s is focused on its core customer and the products they crave, as well as investing in the physical infrastructure of restaurants, to grow traffic and sales.
'Hardee’s is strengthening the brand position, supporting GMs and crews through menu streamlining, digital marketing and working to improve the financial health of our operators.
'Fiscal year 2024 remains on track with an exciting opportunity for growth.'
CKE Restaurant Holdings said it is strategizing a return to 'long term growth and success'. Pictured: CKE Restaurant Holdings CEO Ned Lyerly
The struggling Hardee's locations are not alone in their decline, with several other major fast-food brands also introducing ominous cost-cutting measures.
Last year, Subway reported that it closed more than 500 locations, leading its longtime owners to explore a landmark $10 billion sale.
And this month, rival chain Burger King estimated it will close up to 400 stores by the end of the year, which came as two of its franchisees declared bankruptcy.
Numerous fast-food brands, including Hardees, Wendy's and Carl Jrs, are also rolling out an AI-like chatbot to take orders at its drive-thrus to try and keep pace with their profitable rivals.
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