The Lost Cajun, a full-service concept once headed for aggressive growth, filed bankruptcy Wednesday after devastating effects from the pandemic.
The restaurant’s franchising company, The Lost Cajun Enterprises, filed the petition. The Lost Cajun Spice Company—created in 2016 to coordinate the sale and distribution of goods to the restaurants—also declared bankruptcy.
The Lost Cajun Enterprises listed roughly $338,000 in assets and $1.4 million in liabilities. The Lost Cajun Spice Company listed assets of approximately $6,000.
In October 2016, The Lost Cajun had nine restaurants open across four states, seven of which opened since the start of 2014. The concept said at the time that it hoped to have eight to 10 open by the end of 2017 and as many as 50 in the next five years.
By 2018, 15 franchises were open. Eight more were scheduled to open, and roughly 11 were in the pipeline. The chain expected to debut 10 franchised stores on average per year.
But in 2020, franchisees “fell victim to the global COVID-19 pandemic.” The companies had to implement several cost-saving measures, such as cutting salaries and reducing or eliminating fees for “financially distressed franchisees” who either closed stores or were operating at a reduced capacity.
The methods didn’t work, according to court filings.
“Despite assistance from the Debtors, a number of The Lost Cajun franchisees failed and those that remain open suffered significant revenue losses, with some indicating to Franchisor that closings may be likely,” court documents said.
To assist with operations, The Lost Cajun Enterprises applied for and received Economic Injury Disaster and Paycheck Protection Program loans with a combined value of $330,000. Still though, because the restaurant count has decreased and is expected to drop even further because of COVID, the companies filed bankruptcy to “reorganize their debts and obligations so that Debtors are not, going forward, insolvent.”
“The Debtors believe an immediate and orderly transition into Chapter 11 is critical to the viability of their operations and that any delay in granting the relief requested could hinder the Debtors’ operations and cause irreparable harm,” court filings said. “Furthermore, the failure to receive the requested relief during the first 21 days of these Chapter 11 cases would severely disrupt the Debtors’ operations at this critical juncture and imperil the Debtors’ restructuring.”
Raymond “Griff” Griffin and his late wife, Belinda, opened the first Lost Cajun in Frisco, Colorado in 2010. A couple of years later, Griff and Jon Espey, his fishing buddy, joined forces to open a second unit in Breckenridge, Colorado. After finding success at both stores, the Lost Cajun Enterprises was formed to begin franchising.
In 2018, The Lost Cajun bought out Espey, who served as company president. The brand still owes $651,000 in the buyout agreement. It was forced to stop payments amid COVID.
The restaurant’s website lists 25 locations across Colorado, Louisiana, Mississippi, North Carolina, South Carolina, Tennessee, and Texas. Two are described as “coming soon” in California and South Carolina. The brand offers southern-style home cooking, such as fried catfish, shrimp, oysters, authentic Louisiana Gumbo, po-boys, and beignets.