So, another one bites the dust. M&M Custard, a big-time Freddy's Frozen Custard & Steakburgers franchisee, just filed for Chapter 11. Shocker. Dairy Queen Rival Files for Bankruptcy Newsweek's trying to get a comment, which, let's be real, is just PR spin in disguise. What are they gonna say? "Yeah, we screwed up, sorry"?
This isn't just about Freddy's, though. We've seen chains dropping like flies this year. Bankruptcies, store closures, sales tanking... it's a bloodbath out there. And who's getting hit the hardest? You guessed it: lower- and middle-income folks. The people who actually need a cheap burger and a frozen custard to feel like they're not completely drowning.
M&M Custard's got $5.2 million in assets and a whopping $27.7 million in liabilities. Ouch. That's not just a bad day; that's a financial black hole. They're saying they'll still be able to pay out to unsecured creditors, which sounds great on paper, but I'll believe it when I see it.
They're dragging 31 other affiliate locations down with them, but hey, don't worry, they're all expected to keep operating normally. Right. Because nothing screams "normal" like a bankruptcy filing.
And get this: it's just the franchisees feeling the heat. The parent company's all good. Which, offcourse, begs the question: who's really profiting here?
McDonald's CEO Chris Kempczinski spilled the beans on an earnings call. He admitted that they're seeing a "bifurcated consumer base." Translation: rich people are still eating Big Macs like there's no tomorrow, while poor people are ditching the drive-thru. Traffic from lower-income consumers is down double digits. Double digits! That's not a slump; that's a freakin' collapse.
Chipotle's CEO Scott Boatwright chimed in too, saying they saw a pullback from everyone earlier this year, but now the gap's widening. Low- to middle-income guests are eating out less. Why? Unemployment, student loans, and wages that are basically standing still. It's like we're all running on a treadmill that's slowly speeding up until we faceplant.
Speaking of fast-food graveyards, remember what happened with Dairy Queen in Texas? Dozens of locations shuttered because of a fight over royalty payments and remodels. Franchisees vs. corporate, a tale as old as time. Small business owners getting squeezed to death by the big guys.
It's all connected. These aren't isolated incidents; it's a systemic problem.
It makes you wonder, doesn't it? Are these fast-food giants so out of touch that they don't see what's happening on the ground? Or do they just not care? Are they so focused on pleasing shareholders that they're willing to sacrifice the very customers who built their empires?
Then again, maybe I'm the crazy one here. Maybe I'm just overreacting. Maybe everything's fine, and I should just shut up and enjoy my $8 milkshake.
M&M Custard plans to close some stores to try to claw their way out of this mess. So, fewer jobs, fewer places to grab a cheap meal. Great.
And Hooters CEO Neil Kiefer says it’s a tough time for everyone in the restaurant and hospitality business. It ain’t just the restaurants, buddy. It's a tough time for everyone.
This isn't just about ice cream and burgers. It's about the fact that the American dream is turning into a freakin' nightmare for a huge chunk of the population. We're being squeezed from all sides, and these fast-food bankruptcies are just another symptom of a much bigger problem.
