America's largest bagel chain finds itself in the hole.
The Einstein/Noah Bagel Corp., which owns 539 bagel shops across the United States, announced last month that it won't be able to pay off a $125 million debt and may haveto shut down unless it finds new financing. Other bagel makers are in similar straits, victims partly of overexpansion but mainly of changing American tastes, according to the Los Angeles Times.
The popularity of bagels took off about a decade ago, when health and weight-conscious consumers soughta substitute for the high-fat doughnut. An average sized plain bagel has only 1 gram of fat but 300 calories compared to a chocolate glazed doughnut's 14 grams of fat and 260 calories.
Shawn Kearns, manager of research for Einstein Bros. Bagels in Golden, Colo., inspects a batch of freshly baked beauties. As supermarkets, doughnut chains and coffeehouses offer bagels and consumers quit worrying about fat grams, bagel bakery chains are finding themselves with more storesdoing less business.
With booming economic times, however, and few signs that past diet regimens have notably slimmed theAmerican figure, consumers are ready to live it up, say the experts. "Americans are either tired of experts telling them what's good or bad for them, or they're just too tired to care," notes the Times.Giving weight to the analysis is the fact that while Noah shut down 14 of its stores last year, doughnut chains such as Krispy Kreme and Winchell's are opening up new locations at a record pace.
To some extent, the chain's stores became victims of their own success, with convenient supermarkets, doughnut shops, and coffee joints like Starbucks jumping in and offering bagels to their customers.The company was formed in March 1995 through the combination of four leading regional bagel retailers Brackman Brothers Bagel Bakery in Salt Lake City, Bagel & Bagel in Kansas City, Offerdahl's BagelGourmet in Fort Lauderdale and Baltimore Bagel Co. of San Diego.