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Sbarro Files For Chapter 11

The days of enjoying Sbarro pizza in the mall while waiting in line for the new iPhone may in jeopardy as the chain files for bankruptcy protection to cut its $486.6 million in debt by $195 million.

Sbarro was hit hard in 2007 and 2008 by rising commodity prices for cheese and flour, a challenge that was followed by the recession. In late 2008 and most of 2009, the company suffered from unprecedented declines in traffic at shopping malls, where many of its restaurants are located, according to court documents.

“Price increases and cost-cutting measures taken to combat commodity inflation and maintain earnings during this difficult period contributed to challenges with the brand, and performance lagged the rebound in mall traffic beginning in early 2010,” the company said in its bankruptcy filing.

The hope is that Sbarro can survive and grow into the future after restructuring. Maybe they should pull a Domino’s and admit that they kinda sucked in the past and are hoping to wow food court patrons with new recipes.

(via NRN)

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