Coffee is a growing American pastime. According to the National Coffee Association, a trade group, two-thirds of American adults—66%—drink coffee daily. That’s up 7% from 2020. As coffee consumption rises, coffee shops across the country are experiencing increased pressure due to rising costs and heightened competition.
Even Starbucks, the nation’s largest coffee chain, has felt the strain. In September, the Seattle-based coffee giant announced plans to lay off about 900 non-retail workers and close about 1% of its North American stores amid declining same-store sales.
Last week, a Florida coffee chain known for its unusual flavors and Instagram-ready “coffee flights” filed for Chapter 11 bankruptcy protection in federal court. The Blend Coffee and Cocktails, which operates eight locations in Florida, is seeking to continue operating while restructuring its debts under court supervision. The Blend’s bankruptcy lawyer didn’t return requests for comment, but court documents show a wide range of creditors, including landlords, vendors, and tax collectors.
Business bankruptcies have been rising in the US since 2021, driven by stricter lending conditions and higher costs. Data from Epiq AACER revealed a 7% increase in business bankruptcies last month compared to the previous year, including a 35% jump in small business bankruptcies.
Coffee shops are under additional pressure from the rising cost of coffee beans. The average price of ground coffee doubled in September, reaching over $9 a pound—up from 2020 levels, according to data from the St. Louis Federal Reserve. This increase is being driven by global supply constraints, including droughts in Brazil, which produces about 40% of the world’s coffee. US tariffs introduced during President Donald Trump’s administration have also restricted coffee supplies. Labor costs are increasing as well, according to the National Restaurant Association.
### Coffee Shops and Small Chains That Have Filed for Bankruptcy Protection Since 2024
Despite financial challenges, all the following coffee shops and chains remain in business after filing for bankruptcy protection:
**The Blend Coffee and Cocktails**
The Blend Coffee and Cocktails operates eight locations in Florida. The company filed for Chapter 11 bankruptcy protection in November 2024.
**Cuppa Austin Coffee Shop**
Cuppa Austin Coffee Shop is a single-location café based in Austin, Texas. Its parent company filed for Chapter 11 protection in October 2024.
**Red Bay Coffee**
Red Bay Coffee runs seven locations in the Bay Area. The company filed for Chapter 11 bankruptcy protection in August 2024.
**Switchback Coffee Roasters**
With two locations in Colorado, Switchback Coffee Roasters filed for Chapter 11 bankruptcy protection in August 2024.
**Ink! Coffee**
Ink! Coffee operates four locations in Colorado and filed for Chapter 11 bankruptcy protection in June 2024.
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As coffee prices and operational costs continue to rise, more coffee shops may find themselves facing difficult decisions. For now, these iconic local chains remain open as they work toward restructuring and recovery.
https://www.businessinsider.com/coffee-shops-filed-for-bankruptcy-amid-rising-prices-2025-11