Abuelo’s Parent Company Files Chapter 11 Bankruptcy Amid Shrinking Footprint

Food Concepts International has filed for Chapter 11 bankruptcy. The company owns Abuelo’s Mexican restaurants. The filing was made on September 2 in Texas Northern Bankruptcy Court.

This comes after several quiet closures of Abuelo’s restaurants across the U.S. The chain’s footprint has shrunk from 40 locations to just 16, according to its website.

Major Mexican Chain Enters Chapter 11 as Closures Continue

Abuelo’s has been a recognizable name in Mexican dining since 1989. It once operated in 15 states. Today, only a few remain. The chain has steadily closed locations in Ohio, Oklahoma, Arizona, and Virginia over the past year.

The court filing reveals assets and debts both estimated between $10–$50 million. Food Concepts International has not issued a public comment. However, stores remain open and operational.

Other Mexican chains have faced similar fates. On the Border, Tijuana Flats, and Rubio’s Coastal Grill all filed Chapter 11 recently. All cited inflation, labor shortages, and changing customer behavior.

Why So Many Mexican Chains Are Failing

Industry experts blame rising costs. Food and labor expenses have surged. Labor now consumes up to 45% of sales in some restaurants. That number used to be closer to 30%.

Chains that don’t adapt face big challenges. Consumers want healthier meals and more tech. Online orders and delivery have become essential. Not all chains kept up.

Even big names like Chipotle are affected. In mid-2024, they reported food costs up due to avocados, dairy, and proteins.

The restaurant space has also grown crowded. Too many options and shrinking margins have put many chains in danger.

Chapter 11 Bankruptcy may help Abuelo’s restructure. It gives time to adjust and reduce debts. But survival isn’t guaranteed.

Dropping this nugget your way-

Q1: What is Chapter 11 Bankruptcy?

It allows companies to reorganize while staying open. They keep running while managing debt.

Q2: Why did Abuelo’s file for bankruptcy?

Sales dropped and costs went up. They also closed many stores without notice.

Q3: Are other Mexican chains also affected?

Yes. On the Border, Rubio’s, and Tijuana Flats also filed for Chapter 11 recently.

Q4: Are any Abuelo’s restaurants still open?

Yes. About 16 locations in seven states still operate as of early September 2025.

Q5: Will Abuelo’s close more locations?

Possibly. No official plan has been shared, but trends suggest more closures may come.