The Raleigh-based brewery Gizmo Brew Works, which has a location on East Franklin Street in Chapel Hill, filed for Chapter 11 bankruptcy protection on Friday.
In a press release provided to Chapelboro, the brewery said its three locations in Raleigh, Durham and Chapel Hill will all remain open as the re-organization takes place.
An earlier report from the Triangle Business Journal cited Gizmo’s debts as more than $1.6 million, according to its bankruptcy petition. Gizmo cited financial difficulties stemming from the pandemic, which came shortly after a production facility expansion in 2018-19, and the grand opening of the Franklin Street location in early 2020.
“The difficult but necessary decision has been coming for some time,” the brewery said in its statement. “While fortunate to survive the pandemic as a company, recovery post-COVID has not been sufficient to balance the debt that was taken on during the prior build-out.
The Gizmo Brew Works Taproom sign on Franklin Street, encouraged people to walk down to its entrance at Amber Alley.
“The craft beer industry is also experiencing challenges at this time,” the statement continues, “as inflation has initiated a market shift that impacts how people spend their disposable income, the cost of brewing ingredients, property leases, and other inputs required to run the company and distribute products.”
According to Gizmo, the bankruptcy protection will allow the brewery to both reorganize the company and retain all current staff.
“Our faith in the Gizmo brand, product and team remains high,” the statement read. “We will emerge as a stronger company ready to be successful for years to come.”
Featured image via Gizmo Brew Works
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