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Bennigan's franchisees on their own


Bennigan’s is out of business — sort of. The restaurant chain, along with the associated Steak and Ale chain, filed Chapter 7 liquidation yesterday, WSJ reports. But while 200 corporate-owned stores shut down, 138 Bennigan’s franchisees will remain open, the Journal says. So what happens to a franchise when the franchisor goes under?

Some Bennigan's franchisees actually see the liquidation as a good thing, according to a report in the Post-Tribune, of northwest Indiana. Larry Briski, the local owner of several Bennigan's who also runs the franchisee association, tells the paper that a firm in Atlanta will buy Bennigan's name and continue the franchise operation. Briski says he expects better marketing and branding, calling the change "a very good thing for the franchisees."

The owners will need every bit of support they can get. The Journal details why times are rough for casual dining restaurants:

High ingredient and labor costs are eating into profits, and several years of rapid expansion by bar and grill chains has left a glut of locations in the market. Pressures such as high gasoline prices and dwindling home values have prompted consumers to eat out less often or switch to cheaper fast-food meals.


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