Restaurant chains have faced financial distress caused by rising costs driven by inflation since the end of the Covid-19 pandemic.
Rising inflation led to a 35% increase in labor and food costs from 2019 to 2025, which forced restaurants to pass those costs on to customers, who have not always welcomed the price increases.
Higher menu prices, which rose by an average of 31% from February 2020 to April 2025, based on Bureau of Labor Statistics data, discouraged many consumers from dining out, resulting in a reduction in sales and revenue.
Chain restaurant sales slowed to their lowest growth rate for the Top 500 chains since the Great Recession of 2008, dropping to 3% growth in 2025 compared to 3.5% in 2024, according to a recent Technomic study as reported by Restaurant Business.
The challenging restaurant economics have led certain dining chains to file for bankruptcy protection and to close locations in some cases.
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Thai Wisdom files for bankruptcy
Popular Thai restaurant chainThai Wisdom LLC and affiliate TWBEdmonds LLC filed for Chapter 11 bankruptcy to restructure their debts, according to PacerMonitor.
The Kirkland, Wash.-based Thai dining chain filed its petition in the U.S. Bankruptcy Court for the Western District of Washington on May 26, listing up to $50,000 in assets and $500,000 to $1 million in liabilities, according to the filing.
Thai Wisdom, which continues operating all locations, did not give a specific reason for filing for bankruptcy in its petition.
The debtor’s largest creditors include BHG, owed over $179,000; Rapid Finance, owed over $119,000; Door Dash, owed over $75,000; Washington Department of Revenue, owed over $62,000; King’s Oriental Foods, owed over $53,000; BECU, owed over $50,000; and the U.S. Small Business Administration, owed $30,000.
Thai Wisdom Bistro, established in 2017, operates three locations: full-service casual restaurants, Thai Wisdom Kirkland and Thai Wisdom Lounge Edmonds, and a take-out and delivery restaurant, Thai Wisdom Capitol Hill in Seattle.
Owners prepare ‘secret recipes’
The restaurant chain’s owners, with 30 years of experience, brought authentic Thai cuisine from Ayutthaya, Thailand, offering its ‘secret recipes” and cooking techniques of dishes found throughout central Thailand.
The chain has received favorable reviews, including 5 stars and a high percentage of good ratings, based on the Yelp, TripAdvisor, and Happy Cow websites.
In addition to full-service dine-in, take-out, and delivery services, Thai Wisdom Bistro offers full catering services at all three locations. The restaurants serve lunch and dinner every day of the week, and are open even on Thanksgiving, Christmas Eve, and Christmas Day.
Thai Wisdom Bistro’s extensive dinner menu offers 21 different entrees, 13 dinner noodles, 12 specialty dishes, 9 dinner curry dishes, 8 fried rice plates, and a variety of appetizers, soups, and salads.
Shari’s Restaurant owners file bankruptcy
Thai Wisdom Bistro’s bankruptcy filing came less than two weeks after restaurant chain owner Lena Brands LLC, which operates nine 24-hour, family-dining Shari’s locations in California, Idaho, and Washington, filed for Chapter 11 protection on May 15.
Shari’s, which was established in 1978, operated as many as 95 locations with 4,000 employees in six Northwestern states, according to its 2023 website.
Operator also owns Coco’s restaurants
Lena Brands also owns the remaining two locations of the 78-year-old Coco’s restaurant chain in Mission Hills and Redlands, Calif. The chain had about 300 Coco’s locations in the Southwest at its peak, according to the San Luis Obispo Tribune.
The Dallas-based restaurant chain’s owner did not indicate in its petition why it filed for bankruptcy protection.
Shari’s, which faced financial difficulties since the Covid-19 pandemic, on Oct. 20, 2024, closed all of its Oregon stores, which amounted to 42 locations at the beginning of 2024.
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