Guzman y Gomez has shut down its Chicago stores and abruptly pulled the plug on its ambitions to conquer the American market after years of spending tens of millions of dollars and defending it as a long-term investment.
The burrito chain’s founder Steve Marks said despite efforts to turn around the chain’s US expansion, the Australian-born Mexican burrito seller was not hitting sales targets enough to justify the investment.
“Having spent the last three months in the US, I realised this was going to take significantly more time and capital than we had expected,” Marks said in a statement to the ASX.
“In assessing the trajectory of the current network, the board and I have concluded that the business is unlikely to deliver the performance that would justify continued investment of shareholder capital.”
Guzman y Gomez said it expected to record a hit of up to $US40 million ($56 million) to its financials as a result of the exit.
More to come.
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Jessica Yun is a business reporter covering retail and food for The Sydney Morning Herald and The Age.Connect via X or email.From our partners
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