Another craft beer company now files an unexpected bankruptcy to reorganize, cancel leases, and extinguish its mounting debt.
Yard House and BJ’s competitor, World of Beer, filed for Chapter 11 bankruptcy on Friday, August 2.
World of Beer’s parent company, WOB Holdings, along with 11 affiliated entities, have filed for bankruptcy in the U.S. Bankruptcy Court for the Middle District of Florida.
The company cited several factors that led to this decision, including:
- The negative impact of rising interest rates and lease obligations on their cash flows.
- Ongoing challenges from inflation and increased operating costs.
- A slower-than-expected return to pre-pandemic dining habits.
In the bankruptcy filing, the debtors listed assets and liabilities in the range of $10 million to $50 million.
One of the major creditors identified is Synovus Bank, to whom the company owes more than $25.6 million.
The combination of financial pressures, including the lingering effects of the pandemic, rising costs, and changing consumer behaviors, has ultimately led World of Beer’s parent company to seek bankruptcy protection.
World of Beer started as a Tampa, Florida-based craft beer bar and restaurant, opening its first location in 2007.
The company experienced rapid expansion over the years, growing to as many as 75 locations across 20 states by March 2016, including opening a franchise in Shanghai, China.
However, since that peak, the company has closed more than half of its locations, with only 34 currently listed on its website.
Specifically, the company closed 14 locations in the 12 months leading up to their Chapter 11 bankruptcy filing.
In some cases, rather than shutting down completely, the company allowed franchise owners to rebrand their locations instead of closing them.
For example, in 2017, three World of Beer franchise locations in Virginia were rebranded as Crafthouse by their owner, Evan Matz.
The rapid expansion followed by the significant contraction of the World of Beer chain highlights the challenges the company has faced in maintaining its growth and profitability in recent years, ultimately leading to the bankruptcy filing.
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Also Read: Another Mall Clothing Retailer Now At High Risk of Bankruptcy
Other Economy News Today
A massive rental company with 34k locations now shuts down its operations after filing for bankruptcy and 22 years in business.
Users of movie rental company Redbox were left saddened after it was announced that it would be shutting down operations.
The announcement comes after the rental company’s parent company, Chicken Soup for the Soul Entertainment, filed for Chapter 11 bankruptcy.
According to court documents obtained by the Washington Post, the Connecticut-based company claimed to be one billion dollars in debt.
As a result, Redbox, which was a staple of many grocery stores including Walgreens, and CVS will be shuttered.
Many fans took to social media to express how upset they were with the loss.
“I knew it was coming, sadly,” UltraVada wrote in a post on X, formerly Twitter.
“It was inevitable,” a second person mourned.
“I knew this would happen when I heard they filed for Bankruptcy but its still sad to hear. I have a lot of fun memories of Redbox,” a third person lamented.
“I still don’t think this will be or ever be the end of physical media as we do still get remasters of some movies in 4k/Bluray.”
One person revealed that they had forgotten the rental service had existed.
Some users were not surprised by the announcement.
“Not surprised since nobody really rents videos anymore with the rise of streaming and what not,” one user admitted.
“Also kinda remember getting into a feud with them on here.”
One user also pointed out that the last remaining Blockbuster, located in Bend, Oregon, managed to outlive Redbox.
Redbox was acquired by Chicken Soup for the Soul Entertainment (CSSE) in 2022 and became one of the company’s flagship video-on-demand streaming services.
At its peak, CSSE operated more than 20,000 DVD rental kiosks across the country.
The company’s filing means that the company’s more than 1,000 employees will be laid off, per The Wall Street Journal.
It was also reported by Deadline that many employees at CSSE hadn’t received their paychecks and had medical benefits cut in late June.
Also Read: This Massive Mall Retailer Is Now Closing In California
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