The rise and fall of Chuck E. Cheese, which just filed for bankruptcy after the pandemic pummelled its business

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Chuck E. Cheese is 43 years old. Getty Images
  • Chuck E. Cheese’s parent company, CEC Entertainment, filed for Chapter 11 bankruptcy on Thursday citing pandemic-related reasons.
  • Chuck E. Cheese was originally created by Atari cofounder Nolan Bushnell to serve as the cigar-chewing mascot at Pizza Time Theatre in 1977.
  • Chuck E. Cheese grew into a beloved chain, known in the ’90s and early 2000s for its prize tokens, pizza, and animatronic performances.
  • Visit Business Insider’s homepage for more stories.

Chuck E. Cheese has been through a lot over the last 43 years.

The mascot – full name Charles Entertainment Cheese – was originally created by Atari cofounder Nolan Bushnell, to serve as the cigar-chewing mascot at Pizza Time Theatre in the 1970s. Since then, the chain that took the mascot’s name has been restructured and sold numerous times in attempts to keep up with the trends.

In April, Business Insider’s Casey Sullivan and Alex Morrell reported that parent company CEC Entertainment was struggling under a heavy debt load. Lenders had tapped restructuring lawyers, according to people familiar with the situation. And Thursday, the dinnertainment chain’s parent company, CEC Entertainment, filed for Chapter 11 bankruptcy protection after weeks of speculation over the chain’s impending demise.

Change is nothing new for Chuck E. Cheese. Read on to see how the chain evolved, as Chuck E. Cheese transformed from an animatronic rat from New Jersey to a rock star mouse performing live shows on YouTube.


Atari cofounder Nolan Bushnell founded Pizza Time Theatre in 1977.

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Source:
Fast Company


The star of the restaurant was Chuck E. Cheese, a cigar-smoking rat with a Jersey accent.

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Source:
Fast Company


“I always felt that was something that was lacking in restaurants,” Bushnell told Fast Company. “I wanted to add a dimension of fun to the act of having a meal.”

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Source:
Fast Company


Originally, Chuck E. Cheese made abrasive and sometimes sexual jokes, aimed at adult customers. But, the chain transitioned to more kid-friendly approach relatively quickly in its early years.

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In the ’80s, the pizza chain went public, followed by various restructuring efforts as sales slumped. By 1992, all locations of the pizza chain that had grown out of the Pizza Time Theatre concept were rebranded as Chuck E. Cheese’s.

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Chuck E. Cheese at the Annual Hollywood Christmas Parade in 2003. Mark Sullivan/WireImage


Source:
Nation’s Restaurant News


Chuck E. Cheese’s continued to evolve and grow, reaching 300 locations in 2000.

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Source:
Show Biz Pizza


The chain was famous for its arcade games, prize tokens, and pizza, as well as performances by an animatronic Chuck E. Cheese and crew.

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However, in 2012, Chuck E. Cheese’s struggled to boost sales. After decades of Chuck E. Cheese being portrayed as a rat, the company remade the mascot as a “rock star” mouse.

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According to the company, the mouse’s full name is Charles Entertainment Cheese, an orphan who celebrates others’ birthdays to make up for his own sad childhood.

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Source:
Insider


The makeover failed to bring in customers, and Chuck E. Cheese Entertainment was acquired by private-equity firm Apollo Global Management in 2014 for nearly $US1 billion.

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Source:
The Wall Street Journal


The last few years have seen plenty of change at Chuck E. Cheese. The chain retired its tokens in 2016 and the animatronics in 2017. The chain also changed its name slightly, dropping the possessive to become Chuck E. Cheese in 2017.

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Source:
Business Insider


Since 2017, the chain has been working to revamp locations with new designs, dynamic pricing, and better birthday packages.

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In April 2019, CEC Entertainment announced that the company would return to the New York Stock Exchange through a merger. But, the deal fell apart.

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Source:
Business Insider


The coronavirus pandemic hit the chain hard, with sales sinking 21% in the first quarter. Chuck E. Cheese has attempted to keep fans engaged with pizza delivery and “live performances” from the mascot.

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Business Insider’s Casey Sullivan and Alex Morrell reported this week that the chain has already cut hours and staffing, furloughed most of its hourly employees and some 65% of support-centre staff, and deferred rental payments on its company-operated venues.


CEC Entertainment is struggling under a heavy debt load and lenders have organised and tapped restructuring lawyers, according to three people familiar with the matter.

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Various representatives were not available or declined to comment on Sullivan and Morrell’s reporting.

Read the full report on CEC Entertainment’s most recent struggles and plans to restructure here.


CEC Entertainment finally filed for bankruptcy on Thursday, June 25 after weeks of speculation over the chain’s financial woes. But Mr. Cheese isn’t going away anytime soon — the company plans to continue reopening restaurants through its bankruptcy proceedings.

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Source:

Business Insider