Several restaurants are having trouble getting customers because people aren't going out to eat as much because of rising prices.
This drop in sales and customers has hurt one Utah Burger King franchisee a lot. Last month, Meridian Restaurants Unlimited, which owns 120 Burger Kings, filed for bankruptcy.
Since January, Meridian is the second Burger King franchisee to go bankrupt. The first was TOMS King Holdings, which said that sales and foot traffic were going down.
Over the past few years, Meridian's restaurant sales and income have gone down.
Even though business dropped, the franchisee still had to pay rent, pay off debt, and meet other obligations. Since it bought Burger King stores that were failing, the company has been hurt.
"These lower volumes lead to smaller profit margins, which makes them more vulnerable to the recent sharp rise in labor, materials, and maintenance costs," court documents said.
After filing for bankruptcy, the future of Meridian's Burger King locations in Utah, Montana, Wyoming, North Dakota, South Dakota, Minnesota, Nebraska, Kansas, and Arizona is uncertain.
Court records say that the franchisee hopes that these steps will "open up cash flow to support day-to-day operations, and management wants the business to become strong and successful."
The future of Meridian is uncertain, but that of Burger King is bright. In the last quarter, the company reported positive growth in same-store sales, customer satisfaction, and franchisee profits.