Sumptuous ingredients, crispy fries and homely premises, the hype around fine hamburgers has been great and in the last seven years there has been an absolute explosion of this type of chains around Sweden. Tugg Burgers, Brödernas, Flippin Burger, Shady Burger, Phils Burger and Bastard Burger are some examples.
But now many chains struggle with profitability. Inflation, high raw material prices and increased costs mean that many restaurant owners are wondering how to survive another tough economic winter.
– In the first quarter of 2023, we had prepared for it to be difficult, but we could never have imagined that it would be this difficult. It was slaughtered to speak clearly, says Carl-Henrik Forssbeck who is one of the founders of Bores.
“Unfortunately, it looks dark”
Hamburger restaurant Bores has been forced to put five of its total of nine restaurants into bankruptcy with debts of around SEK 8 million. The parent company of Tugg Burger and Flippin Burger has also filed for bankruptcy for some of its restaurants. Baba’s Burger and Phil’s Burger have filed for reorganization in hopes of avoiding bankruptcy.
– Now the companies assess that demand will fall and profitability will fall even more than it has so far, so unfortunately it looks bleak for the autumn, winter and also next spring, says Thomas Jakobsson who is chief economist at Visita.
“The lunches have more or less died”
When households receive higher overhead costs, many people indulge in everyday luxuries and fewer people go out to eat lunch at a restaurant.
– Lunches have more or less died, this applies not only to our industry but in general in the restaurant industry. My best friend who works at Peab said that it went from being completely empty to now it’s completely smeared by the microwave ovens, all of a sudden everyone has lunch boxes with them… So we’re preparing for a tough 2024, and I think most of them do, says Carl-Henrik Forssbeck.