A business that owns over 150 Applebee’s franchises in different states, including several in Kentucky, recently announced that it filed for Chapter 11 bankruptcy. According to the company, their restaurants will be able to remain in operation while the bankruptcy is ongoing.
According to the company’s bankruptcy paperwork, it owes somewhere between $100 million and $500 million to different creditors. In the same official paperwork, the company indicated that the total value of its property was also between $100 million and $500 million, although the exact figures were not made available and may even be difficult to determine offhand.
The filing of this bankruptcy serves as an important reminder to those business owners, of all shapes and sizes, who own franchises in the Louisville area. Many people in this city make their living by owning and operating one of the country’s hundreds of franchised restaurants, stores and other businesses. However, despite the fact that owning a franchised business is supposed to take away some of the work it takes to build up a firm, owning a franchise comes with considerable risk to a local business owner.
After all, they still have to figure out how to make their local outfit turn a profit and must do so while they are complying with a franchise agreement that could prove cumbersome and expensive at times. It’s not terribly surprising that many of these franchises fail or struggle despite the best efforts of their owners.
Although not every franchisee is as large as the one which recently filed bankruptcy, it is important for small corporations and individuals who own franchises to remember that different types of business bankruptcy debt relief may be available to them if they should run into financial difficulties.