Fears for restaurant chain known for award-winning pies - after sudden closures and reports of rent arrears and $1.5million in unpaid taxes

Fears are growing for the future of a popular restaurant chain after it closed dozens of its locations. 

Shari's, known for its award-winning pies, once operated around 100 restaurants across the Pacific Northwest, California and Idaho but that number has now fallen to 60. 

The closures, including seven in the last five months, come amid reports of unpaid bills, large back taxes owed and even eviction notices at some of its locations. 

The chain's position looks increasingly uncertain at it faces legal battles in Washington, Oregon and Idaho. 

The family-style restaurant chain, first opened in 1978, owes Washington State Department of Revenue almost $1.3 million in back taxes. 

Shari's has closed more than 40 locations amid unpaid taxes, rent and other bills 

Read More

Fast casual Mediterranean restaurant chain files for bankruptcy - despite surviving pandemic

The state issued three tax warrants between October and December last year. 

There are also at least 11 debt collection cases filed against the company in the state since 2020.  

Plus Shari's owes Idaho around $220,000 in back taxes and the State Tax Commission has placed six liens against its management company.

Further to this, two landlords have filed eviction notices after rent went unpaid. 

One property owner in Kitsap County, Washington, is owed more than $150,000 in unpaid rent.

Shari's also reportedly owes six figures sums to other companies, including for construction, plumbing and marketing services. 

Sarah Thomas, the president of Charlton Marketing, told local news that the chain owes her advertising agency over $100,000 in unpaid bills. 

'I've had to lay off staff. I've had to really look at my bottom line,' Thomas told KGW 8. 

'To Shari's, I don't know how much money that means to them, but to us it means a lot.' 

Retail experts say the location closures are not surprising. 

'Full-service concepts have had a difficult time raising money,' Aaron Allen, founder of global restaurant consulting firm Aaron Allen & Associates told The News Tribune. 

Allen explained that the rising cost of labor, food and rent since the pandemic have left chains struggling. 

'All three of those have gone up at rates that are faster than what they're able to increase their menu prices,' he said. 

Although Allen does not expect the chain to immediately close down its remaining stores, he could foresee a potential 'slow withdrawal from the commercial landscape.'

Shari's is known for its award-winning pies and home-style cooking 

The family-dining favorite has closed around 40 locations in recent years 

Shari's is the latest restaurant chain to struggle with increased running costs and inflation-weary customers dining out less. 

Mediterranean chain Roti has filed for Chapter 11 bankruptcy protection just last month. 

Most recently the popular Italian restaurant chain Buca di Beppo closed 13 of its underperforming locations and filed for bankruptcy. 

Red Lobster is one of the most high profile chains to run into trouble, filing for bankruptcy in May and shuttering almost 100 restaurants. 

Just one month later, Mexican chain Rubio's shut 48 locations in the state and also filed for bankruptcy. 

BurgerFi - which touts itself as an upmarket McDonald's - sparked concerns of mass closures after warning in August it may go out of business.

Hooters has also shut dozens of its restaurants in recent months, blaming the rising cost of rent and food.