SAN FRANCISCO (Reuters) - Opportunity beckons for restaurant survivors in what may be a record year for industry bankruptcies that free up plum U.S. locations and ease competition.
Eateries are going belly up faster than usual, said Ron Paul, president of restaurant consulting firm Technomic. "We are already running slightly ahead of pace. Typically in slow times we have seen at least six per year."
S&A Restaurant Corp, owner of the Bennigan's and Steak & Ale chains, last week filed for Chapter 7 liquidation, shuttering dozens of company-owned restaurants and becoming the fourth large chain to go bankrupt this year.
But those publicly held chains are more the exception than the rule. Unlike retailers, most restaurant operators -- excluding those owned by public equity firms -- do not pile on loads of debt.
Harlan Platt, a professor of finance at Northeastern University, said that while the industry would likely see more small or marginal restaurant chains fail, the demise of Bennigan's and Steak & Ale does not foretell an avalanche of bankruptcies in the restaurant industry.
"I don't think it's a sign that the end is near. I'm surprised they lasted a long as they did," Platt said.
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