Local Pizza Hut future uncertain in face of bankruptcy

Local officials have learned that the franchise holder for the New Albany Pizza Hut has filed for Chapter 11 Bankruptcy. This could mean closing the restaurant.

The company is NPC International, which is said to be the largest franchise holder for Pizza Hut and Wendy’s restaurants in the country.

According to trade publication stories, the company plans to close up to 300 Pizza Hut restaurants as a result. A list of closing stores was not available earlier this week so it was not known whether the New Albany restaurant would be affected.

Customers have said the local restaurant appears to have had problems with being understaffed at times over the past several years.

The company has been struggling for some time in the face of weak sales and what franchisees call a lack of innovation compared to competitors such as Domino’s and Papa John’s. In addition to revenue lost to the pandemic, the company has incurred continuing expenses for personal protective measures for employees. This past year the company considered closing as many as 500 stores.

NPC’s Wendy’s restaurants are faring much better than Pizza Hut and one report said that the company is planning to sell that part of the business.

No closings were planned for the company’s Wendy’s but that would not affect New Albany anyway because the Wendy’s here is owned by a more local franchise holder, the Carlisle Corporation.

It appears that the Pizza Huts more likely to close are those that are not equipped for carry-out and delivery, and that the company is trying to move away from dine-in-only restaurants. The local Pizza Hut has provided carry-out and delivery service for years.

County and city officials became concerned because the company could owe ad valorem and real property taxes for this year that might be difficult to collect through the bankruptcy proceedings.

A similar situation concerning taxes exists with VIP Cinema Seating, which also filed for bankruptcy earlier this year, although the amount owed for a manufacturing facility with several hundred employees would be significantly more than a local restaurant.

Although NPC International has the Pizza Hut franchise here, the property has been listed as owned by Marianne Lomardi of Gridley, Calif.

NPC is based in Leawood, Kansas and operates more than 1,200 Pizza Huts and 380 Wendy’s. The company’s debt was reported to be $903 million.