Gastropub chain Bar Louie has filed bankruptcy and closed dozens of its locations, citing declining sales as consumers shift away from casual dining.

While a turnaround effort has improved the performance of most of Bar Louie’s 110 locations, 38 “have seen their sales and profits decline at an accelerating pace,” with same-store sales down 4.2% last year, the company said in court papers accompanying its Chapter 11 petition.

The underperforming stores were closed immediately preceding the filing. Bar Louie will pursue asset sales through the bankruptcy process and lenders have agreed to provide as much as $22 million to keep it operating.

“Bar Louie is a profitable business focused on long-term growth with new investors. The sale through Chapter 11 will help us to focus on our profitable core locations and expand in areas that have a proven track record of success,” CEO Tom Fricke said in a news release.

The company, which was founded in Chicago in 1991, offers a range of beer, liquor and pub food such as burgers and sandwiches, with many of its restaurants located near shopping malls and business districts.

“Several mall staples, which try to attract hungry shoppers, are running into problems as fewer people shop at malls,” CNN reported.

Howard Meitiner, Bar Louie’s chief restructuring officer, said an “inconsistent brand experience”
coupled with increased competition and the general decline in mall traffic has resulted in reduced traffic at the company’s restaurants and contributed to sales falling short of forecast.

The customer declines “were also driven by major changes in consumer behavior, including the general national trend away from casual dining,” he said in court papers.

As part of its turnaround strategy, Bar Louie has focused on driving traffic, increasing sales, and enhancing the customer experience through, among other things, a loyalty program and the construction of private dining rooms.

But according to Meitiner, the company’s lack of liquidity “has resulted in delays to the broader rollout of these initiatives to other locations and curtailed the ability to implement further marketing-related activities compared to others in the industry.”

Jeffrey Greenberg/Education Images/Universal Images Group via Getty Images

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