While some of the eatery giants like Domino’s has managed to survive during the pandemic, others have suffered massive losses. Pizza Hut is one of the giants who is expected to shut down permanently after the bankruptcy of one of the chain’s largest franchises. As a result nearly 300 Pizza Hut are expected to be permanently closed. NPC international has filed for Chapter 11 in the month of July, 2020 and has come in to an agreement with the owner Yum! Brands.
The agreement has said that it will b closing about a quarter of the restaurants and will be selling the remaining locations. The restaurants that have to be shut down are not yet determined but the NPC has said that majority of the affected locations have dining rooms. The agreement has provided flexibility to NPC so they can explore the options to determine value for maximizing outcome. The company is looking forward for financial restructuring that would help to come out of Chapter 11.
Some of the major reasons of the shut down of the restaurants include the coronavirus induced lockdowns that lead to a huge debt burden of about $1 billion and increasing labor and food costs. Pizza Hut on August 17, 2020 informed that about 300 locations in the United States have not performed well compared to the rest of the Pizza Hut locations of NPC. The company also assured that it will help the employees to find jobs at the nearby Pizza Hut locations. In recent times, due to the pandemic, the chain was forced to shift away from opening and operating the restaurants that have dining rooms.
It was only encouraging the customers to pick up their orders or order for home delivery with the help of the official website or third party apps. The coronavirus pandemic has affected a number of eateries that offer dining. A number of them are on the verge of shut down and many of them have also filed for bankruptcy.
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