West Michigan Barbecue Chain Declares Bankruptcy Due to ‘Extreme’ Demands
Renowned West Michigan barbecue restaurant chain, Dickey’s Barbecue Pit, has declared bankruptcy, citing ‘extreme and unreasonable’ financial impositions from the corporate owner, Dickey’s Barbecue Restaurants, Inc.
The Backdrop
The operator of four prominent Dickey’s Barbecue Pit franchise restaurants in West Michigan, Smokin’ Dutchman Holdings, has officially filed for bankruptcy in federal court in Grand Rapids. The company operates these popular barbecue joints in Kalamazoo, Rockford, Jenison, and Holland under a franchise agreement. Krage Fox, the co-owner of Smokin’ Dutchman Holdings, disclosed that the firm is currently $2.1 million in debt.
The Claims
Fox attributes his company’s financial predicament to the ‘extreme and unreasonable’ pressures exerted by the franchisor, Dickey’s Barbecue Restaurants, Inc. However, specifics regarding these claims have not been detailed in the legal filing. Perry Pastula, an attorney representing the beleaguered Smokin’ Dutchman Holdings, refrained from commenting further owing to potential legal complications.
In the released document, Fox appealed to the bankruptcy court to ‘reject the Dickey’s Franchise Agreements.’ This action aims to absolve Smokin’ Dutchman Holdings from the ‘burden imposed upon it by Dickey’s,’ as per the legal filing.
The Counter Claim
Jeff Gruber, senior vice president of franchise relations at Dickey’s Barbecue Restaurants, Inc., countered the allegations made in the bankruptcy declaration. He argued, “For anyone to state we imposed ‘extreme and unreasonable demands’ is simply inaccurate.” He assured that the company has been, and will continue to, provide Smokin’ Dutchman Holdings with consistent support, similar to what they had been offering over the past six years.
The Locations and Revenues
The four Dickey’s Barbecue Pit establishments operated by Smokin’ Dutchman Holdings are situated in Kalamazoo, Rockford, Jenison, and Holland. The Holdings company employs 26 people and has recorded approximately $2 million in earnings this year. Over the past two years, the chain’s annual revenues fluctuated between $3.3 million to $3.7 million.
Looking Ahead
Despite Smokin’ Dutchman Holdings filing for bankruptcy, the chain’s outlets are still operational as usual. As per Pastula, the franchises will stay active, and employees will continue receiving their salaries. The bankruptcy court has authorized measures that make these provisions feasible.
Endnote
Founded in Dallas, Texas, in 1941, Dickey’s Barbecue Restaurants have since expanded to more than 500 locations across 44 states. While the dispute with Smokin’ Dutchman Holdings continues, fans of Dickey’s Barbecue Pit across West Michigan can take heart that their favorite local outlets remain open for their usual servings of barbecue delights.
