Chuck E. Cheese has become a cultural institution over the past few decades, delighting the young and young at heart in the process. If a new report is any indication, there's a chance that the franchise's future could be in jeopardy. The Wall Street Journal is reporting that Chuck E. Cheese's parent company, CEC Entertainment, is nearly $1 billion in debt. The Irving, Texas-based company has reportedly approached lenders in recent weeks in hopes of getting a $200 million loan, in hopes of avoiding filing for bankruptcy. If that idea is unsuccessful, Chuck E. Cheese might end up closing its stores.
According to the report, CEC is planning to present its executives with retention bonuses totaling almost $3 million, as a way to keep them on during this uncertain time. This would include a $1.3 million pay to CEO David McKillips.
The report cites the current COVID-19 pandemic as being partially responsible for Chuck E. Cheese's current woes -- which is understandable, given the still-ongoing situation. Even as social distancing guidelines begin to improve, many families still might be uncertain about sharing the public space of Chuck E. Cheese's arcade and eating area.
CEC Entertainment came under controversy last month, when it was revealed that they have been selling pizza similar to Chuck E. Cheese's under a completely different restaurant name - Pasqually's Pizza and Wings - on delivery apps like Grubhub.
"CEC Entertainment, Inc. recently launched Pasqually's Pizza & Wings nationwide. The inspiration was rooted in the desire to create a premium pizza while staying true to the CEC brand," a Chuck E. Cheese spokesperson said at the time. "Pasqually's Pizza & Wings, named after another favorite member of Munch's Make Believe Band, shares kitchen space with the Chuck E. Cheese restaurant, ensuring high-quality, fresh ingredients. Pasqually's Pizza & Wings' recipes use fresh, homemade pizza dough, just like Chuck E. Cheese, but it is a different pizza that features a thicker crust and extra sauce, giving consumers a more flavorful, more premium pizza experience. While Pasqually's Pizza & Wings recipes are currently only available for delivery, select items might be added to the Chuck E. Cheese menu in the future."
"The whole business of Chuck E. Cheese is designed around the birthday experience, so people don't normally think of pizza when they think of Chuck E. Cheese, even if it is a good product," Duncan Brannan, who formerly voiced Chuck E. Cheese, explained in a recent interview. "People think of birthday parties, the arcade, and a ball crawl, but not pizza... Businesses have done this for years — where they create their own competitor to spread their market. I also read that it was a new recipe, so more power to them, especially considering the fact that everyone is hurting from this pandemic — they're trying to figure out how to stay in business."