Chain shutdowns become more common after the pandemic

Smokey Bones, the barbecue chain, is one of four major chain closures since December. | Photo: Shutterstock.

Earlier this month, about a year after it was sold out of bankruptcy, the casual-dining Mexican chain On the Border shut down all its company locations, leaving only six franchisee-owned units. 

While the brand technically lives through those remaining operators, it’s the latest in a string of brand shutdowns. 

Three mid-sized chains with well-known names have closed this year alone. And since the pandemic, Chapter 7 filings and outright brand closures have become far more common than they historically have been. 

The phenomenon is the result of a tough operating environment coming out of the pandemic and the lack of financing for restaurant operating companies, particularly full-service brands and those in declining sectors. Low-end investors who frequently rescued such chains also appear to have a diminished appetite for such fix-it projects. 

Here’s a look at the chains that had 25 or more locations at their peak that have shut down since the pandemic:

On the Border

On the Border was founded in 1981 and at its peak operated 166 locations. But the casual-dining Mexican brand has steadily declined over the years, when it was traded from one private-equity group to another. It filed for bankruptcy last year and was sold to Pappas Restaurants. But Pappas this year decided to close those restaurants and liquidate. It is the latest closure of a full-service Mexican brand. 

Smokey Bones

Smokey Bones was the biggest casualty of the bankruptcy of the restaurant operating company Fat Brands. Founded by Darden in 1999, the barbecue chain struggled and was sold to Sun Capital Partners in 2007. Sun owned the chain for years but sold it to Fat Brands in 2023. Fat Brands planned to convert most of its 61 locations to Twin Peaks. It couldn’t accomplish much of that goal, landed in bankruptcy, and Smokey Bones was ultimately shut down.

Bahama Breeze

Unlike Smokey Bones and On the Border, Bahama Breeze didn’t take a turn under private-equity ownership. Like those two chains, it operated in a difficult market, in this case seafood. Sales at full-service seafood chains declined 1.8% last year. Darden announced strategic alternatives for the brand, including a potential sale. It decided to shut down some locations and convert others into its other brands instead. 

@jonathandmaze Why so many #restaurant chains are shutting down on this #fastfoodminute#business#bankruptcy♬ original sound – Jonathan Maze

K&W Cafeteria

The regional chain had been around for nearly 90 years and was a mainstay in North Carolina. But the brand struggled coming out of the pandemic and landed in bankruptcy. It was later sold to another cafeteria-style chain, Piccadilly. The brand was down to just 10 locations at the beginning of 2025. By December, the chain would call it quits.  

The buffet bloodbath

No sector has been fundamentally as devastated as the buffet sector, but it’s not the pandemic that did it in. Several buffet brands have shut down since the pandemic, including several owned by the company formerly known as Buffets Inc., which owned at one point Old Country Buffet, HomeTown Buffet, Ryan’s and Furr’s. Those brands had five bankruptcy filings among them. 

There’s also Souplantation and Sweet Tomatoes, the buffet brand that called it quits in 2020, when it had 97 locations. That company was resurrected late last year.

Cheeseburger in Paradise

The chain, named after one of Jimmy Buffett’s best-known songs, was an island-themed casual-dining restaurant developed by the company now known as Bloomin’ Brands back in 2002. At its peak it had 38 restaurants. But it was sold to Luby’s in 2012. The chain gradually shrunk over the years and closed its last location in New Jersey in 2020. 

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