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In 2018,fast food chain Burgerim was the brand to watch. After opening 200 locations during the three years and observe more than 1,200 franchise agreements, the success of the rapid expansion burger concept seemed inevitable. However, as it turns out, the rapid growth of Burgerim masked a troubled operation, whose experts now call "one of the largest franchizing disasters of recent memory". Just as quickly as he has achieved a semblance success, Burgerim is currently experiencing an epic fall that could soon push her tobankruptcy… or worse.

According toRestaurant BusinessBurgerim had a fleet of about 280 restaurants up to his success, who were all cursor style burgers with various cakes. The concept is from Israel, where the founder Oren Loni had several brands of food. Loni brought the concept to the United States and started making franchisees at a speedy speed. (RELATED:7 new fast food chicken sandwiches everyone is talking.)

Operators interviewed byRestaurant Business Let's say that becoming a Burgerim franchisee seemed to promise a lucrative, inexpensive and safe opportunity, but it quickly became clear that Burgerim's leadership had no intention of managing a real franchise. Their only interest, operators say that the collection of initial payments of the $ 50,000 franchisee as the main source of income from the company.

Many of them say they have a difficult period to open their restaurants due to construction charges and leases that ran a much higher than the estimates of Burgerim. The full and complex menu has also made too expensive operations. Dozens have closed their doors after only several months of work or never completely open before going bankrupt. He reported that Burgerim provided little support (even not collecting monthly royalty payments from their operators, which led to wages without salaries).

By 2019, Burgerim was facing dozens of prosecutions for franchises in search of a refund. At the end of the year, the company's corporate team was inaccessible and calls to the company's headquarters were unanswered. According to reports, Oren Loni had left the country. In the meantime, the company would always appear more agreements with new franchisees, even in dealing with bankruptcy.

From this march, the company has still not been filed for bankruptcy, but itis Under the new direction that tries to save the brand. According toFranchise timeBurgerim has concluded a settlement with the state of California, ordering the corporation to pay $ 4 million in fines to violate state franchise regulations and reimburse more than $ 57 million in franchise costs.

Most of the chain restaurants are now closed, with some125 locations always running... but not necessarily for a long time.

For more information on restaurant bankruptcies, consult the10 biggest bankruptcies of the 2020 catering chainAnd do not forget toSubscribe to our newsletterTo get the latest news from the restaurant delivered directly to your inbox.