When a restaurant stops paying its employees, that’s usually an early sign of financial trouble.
Consumers may notice signs of trouble at one of their local favorites before it shuts down. Sometimes it’s little things like poor staffing, reduced hours, running out of popular menu items, or other obvious signs that cash has become in short supply.
“It is rarely just about food quality or just about marketing. It’s usually a breakdown in the full value equation,” Robin Gagnon, co-founder and CEO of We Sell Restaurants, told Food Institute, adding that consumers are looking at value, not price, and considering “food quality, speed, consistency, convenience, digital ordering, atmosphere, and whether the brand still feels relevant.”
Sometimes, however, exactly what happens isn’t clear, and the doors simply close.
Payroll disruptions are among the clearest warning signs because they often indicate that a company is struggling to meet its most basic financial obligations.
That’s what just happened at a number of corporate-owned Beef-a-Roo restaurants.
Beef-a-Roo shuts down restaurants
Several Beef-a-Roo locations appeared to close on Thursday, July 2.
“Calls to the eight locations in Rockford, Loves Park, Machesney Park, and Roscoe were not answered Thursday during normal operating hours. Local employees said they knew of at least two locations that were closed because they did not have food,” WIFR reported.
Beef-a-Roo’s website has also been taken down, and you cannot order through its app, TheStreet verified.
A visit to that website, through the internet Wayback Machine, showed what the chain considered its mission.
“Looking for a meal that tastes like home? At Beef-A-Roo, every sandwich, salad, and fry is made fresh to order with premium ingredients and a side of hometown pride. From our signature roast beef sandwiches to our famous loaded fries and hand-crafted burgers and shakes, we’re here to serve up top-quality food that fits your busy day,” the company posted on the currently-not-operational website.
In a press release from Beef-a-Roo Inc., the temporary closures include the following restaurants:
- Highcrest location at 1680 N. Alpine Rd. in Rockford
- West Dundee, Illinois
- Springfield (Kearney), Missouri
- Joplin, Missouri
- Warsaw (Center Street), Indiana
- Pittsburg, Kansas
- Little Rock, Arkansas
“These decisions are never easy because they affect people, communities and team members who have worked incredibly hard for this company,” Beef-a-Roo Vice President Jeremy Wise said. “Our responsibility is to make the difficult decisions today that position Beef-a-Roo for long-term success tomorrow.”
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Beef-a-Roo stopped paying workers
The shutdowns happened after Beef-a-Roo workers said that their paychjecks had stopped.
“The delay is the result of an unexpected interruption in the funding process for this payroll cycle,” Beef-a-Roo Inc. Vice President Jeremy Wise told WIFR.
He says the company expects every employee to be paid in full.
“While we cannot provide an exact completion time for every payment, we are actively distributing funds rather than waiting for a single payroll release,” he added.
Workers for the chain held a strike on July 3.
A group of Rockford-area Beef-a-Roo employees held a demonstration on Friday, July 3, at the N. 2nd Street restaurant, according to a Facebook post.
“We are now calling on community members to join us at the N. Second Street Beefaroo from 4-7 pm tomorrow as we strike to hopefully send a message to headquarters in TX that this is unacceptable!” the statement says in part.
“We will not work for free! If you are unable to picket with us we would appreciate any donations of water, ice, sign making materials or even a honk as you drive past to let us know you are with us!”
The corporate office has said that the closed locations are “paused” and will reopen.
“It’s unclear when the paused locations nationwide will be up and running again. In the June 29 statement, the company said it would be providing resources for those impacted and reaching out to employees eligible for transfer opportunities,” WANE reported.
Beef-a-Roo corporate did not respond to requests for further comment.
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