According to the CEO of Garden Fresh Restaurant Intermediate Holdings (GFRIH), they are.
This past week, John Morberg filed an affidavit in support of the chapter 11 bankruptcy filing of GFRIH, the holding company to restaurant brands Souplantation and Fresh Tomatoes. This family of restaurants includes 123 locations, 17 central kitchens and 2 distribution centers. All in, the company has 5500 employees, the majority of which work in the restaurants located in California, Texas and Florida.
In addition to having approximately $135mm of funded debt, the company experienced increasing cash flow pressure which, according to Morberg, triggered the bankruptcy. Chief among the causes for this pressure was "declining sales consistent with the declines experienced in the entire restaurant industry." Morberg, here, is clearly referencing a string of recent restaurant bankruptcies including Cosi, Fox & Hound, Logan's Roadhouse, Don Pablo's, Zio Restaurants, Buffetts, and Champps. Cheap gasoline was supposed to translate into bigger consumer spending. Not so for these restaurants, apparently.
Still, Morberg's explanation for the bankruptcy went a step farther. He noted that cash flow pressures also came from increased workers' compensation costs, annual rent increases, minimum wage increases in the markets they serve, and higher health benefit costs -- a damning assessment of popular progressive initiatives making the rounds this campaign season. And certainly not a minor statement to make in a sworn declaration.
It's unlikely that this is the last restaurant bankruptcy in the near term. Will the next one also delineate progressive policies as a root cause? It seems likely.