Just weeks after the last Krystal restaurant in Ocala shut its doors, the chain has filed for bankruptcy.
The eatery, which is known for its small hamburger sliders with steamed-in onions that largely resemble those sold by the popular White Castle restaurant chain, sought protection under Chapter 11 bankruptcy even though it had closed more than 40 locations across the country. That included the eatery at 2420 SW State Road 200.
Krystal, based in Dunwoody, Ga., is hoping to reorganize and come back into the marketplace in a stronger position. The company has blamed increasing labor costs and online deliver competitions as two of the many factors leading to the bankruptcy filing.
Krystal was founded in October 1932 in Chattanooga, Tenn. From the early 1930s through the early 1960s, much of the chain’s items were served on porcelain dishes with the Krystal logo emblazoned on them. The chain added its first drive-through window in the 1950s, as well as cake doughnuts that were served for breakfast and as a dessert item. And from 1970s until 1986, the chain offered kettle-friend chicken and side dishes sold from stand-alone restaurants.
Krystal operates both company-owned and franchise restaurants in several states besides Florida, including Alabama, Georgia, Kentucky, Louisiana, Mississippi, South Carolina and Tennessee. The chain also filed for bankruptcy protection in the late 1990s and then reached a peak of 420 locations in 2002 before going through another round of downsizing. It announced plans in October to sell up to about half of its 320 locations, which resulted in significant downsizing in many communities besides Ocala and Leesburg in the southeastern portion of the United States.
In past years, Krystal restaurants also played host to a competitive eating contest dubbed the “Krystal Square Off.” The world record is 103 Krystal burgers eaten in eight minutes by Joey Chestnut, which was set at the 2007 competition.