Nationally acclaimed fast-casual chain closes locations | Official Website of Louis Velazquez, entrepreneur, finance guy and tech innovator

Despite the protein-rich diets and eating-healthy trends, comfort food will always see demand from consumers. In fact, 55% of consumers prioritize comfort food when preparing their meals at home, according to the Food Industry Association (FMI).

The situation is somewhat similar when dining out. “Dining out is often seen as a treat, so consumers may say they want to eat healthier but still order less-healthy options,” reveals McKinsey & Company‘s January 2026 report.

Fast-casual industry key takeaways

Sector growth: Fast casual outperformed the broader restaurant industry, despite persistent inflation.
Traffic trends: Traffic rose 3% year over year (per Circana), though Placer.ai noted a more modest 1.9% increase.
Price sensitivity: Nearly 50% of consumers who visited less often cited higher costs as the reason.
Income divide: While 20% of people spent less, one in four higher-income diners increased their spending. Source: Fast Casual

Customer pricing sensitivity, shifting consumer behavior, inflation, and high labor, rent, and ingredient expenses have forced many chains to close their doors or file for bankruptcy over the last couple of years. Some examples include TGI Fridays, FAT Brands (Smokey Bones, Johnny Rockets, Yalla Mediterranean), Tijuana Flats, and more.

Now, one nationally-acclaimed comfort food-serving chain joins the group, revealing several closures by its biggest franchisee.

Federal Donuts & Chicken biggest franchisee closes several stores

The largest franchisee of Federal Donuts & Chicken has closed five locations in Philadelphia and its suburbs. The founders of the fast-casual chain popular for its donuts, fried chicken, and coffee, chefs Michael Solomonov and Steve Cook, are now focusing on resetting the brand, reported The Inquirer.

Recent closures have somewhat disrupted an ambitious expansion plan. Solomonov, Cook, and three partners opened Federal in 2011, turning their love for comforting fried food into one of the most recognizable brands in Philadelphia.

The chain quickly earned national acclaim through its James Beard Award-winning founders, who are celebrated for their influential culinary group, CookNSolo. The brand’s cult-like status was solidified by high-profile coverage in The New York Times and the release of their popular 2017 cookbook, Federal Donuts: The (Partially) True Spectacular Story.

In 2023, Federal rebranded as Federal Donuts & Chicken and started building around its first major franchise group, including Mike Sloane, a Montgomery County restaurateur, and Michael Heller, chief executive and chairman of the Cozen O’Connor law firm.

Sloane and Heller launched with four locations and added three new ones, and now five of those are closed.

Stores that have closed

These four locations were specifically shut down by the franchise group.

1776 Benjamin Franklin Parkway, Philadelphia: Opened November 2021; closed in early 2026.
22 Wolf St., Philadelphia: The company location opened in March 2024 and closed in March 2026.
232 N. Radnor-Chester Rd., Radnor: Opened September 2024 as the first suburban Philadelphia-area franchise; closed in March 2026.
4021 Welsh Rd., Willow Grove: Opened January 2025, closed in March 2026. Source: The Inquirer

Federal Donuts & Chicken’s biggest franchisee closes several stores.

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Why the Federal Donuts & Chicken franchisee has closed four stores

Sloane, speaking on behalf of Heller, wouldn’t provide a specific reason for the closure, according to The Inquirer.

“These situations can be complicated, and not every partnership evolves the way people initially expect,” Sloane said, adding that he appreciates what the founders made and wished the chain future success.

“Franchisees make their own decisions,” Cook said. “We both learned a lot making the transition from company-owned stores to franchising.”

These closures do not suggest that all the other franchisees are struggling or thinking of closing.

For example, owners of the location at Marlton Square say they are “holding their own,” though they also noted some specific challenges, including slower growth in suburban areas. They plan to improve their marketing, as many customers are not noticing their store, which shares a parking lot with Trader Joe’s, but delivery orders are still strong.

Other stores remain open, and founders reveal a new strategy for the brand

Solomonov and Cook have expressed interest in buying back and reopening some of the closed franchise locations as company-owned stores later this year.

The duo plans to reopen the Parkway store in April and are trying to buy back Sloane and Heller’s still-open franchisee locations in East Market and North Philadelphia.

At the center of the chain’s new strategy is the store at 1909 Sansom St., which the founders already acquired from the franchisee. The location now serves as the company’s new flagship and test kitchen, where Federal will explore menu reduction, cooking chicken on-site, and reviving bone-in chicken.

“There’s really no fireworks here. It’s basic — trying to see what we can do to continuously improve what we’re already doing,” Cook told The Inquirer.

Federal Donuts & Chicken stores that remain open

300 Route 73 South, Marlton
200 Ridge Pike, Conshohocken
3025 Market St. (Gather Food Hall), University City
701 N. Seventh St., Philadelphia
21 S. 12th St., Philadelphia
1909 Sansom St., Philadelphia
540 South St., Philadelphia
Philadelphia International Airport
Xfinity Mobile Arena
Citizens Bank Park

Future Federal Donuts & Chickenfranchise locations

MarketFair, 3535 Route 1, Princeton
621 Harrisburg Ave. (College Row at Franklin & Marshall), Lancaster
Hard Rock Hotel & Casino, Atlantic City Source: The Inquirer

It began as a side project: Federal Donuts & Chicken’s history

Federal Donuts & Chicken was founded in 2011 by five trailblazers including James Beard Award-winning restaurateurs Solomonov and Cook. “It raised the bar on these comfort classics, giving Philadelphians a whole new reason to get out of bed in the morning,” reads the description on the brand’s official website.

The brand was developed as a side project.

“We planned to stay open through 9 p.m. every day and even deliver fried chicken dinners via bicycle. We really thought of it as a side project, a little something we’d do for fun. We didn’t know,” founder Tom Henneman told BillyPenn.

But the original concept took off quickly, with the shop being sold out by early afternoon on the launch day.

Federal Donuts & Chicken menu

“Federal Donuts and Chicken offers a unique blend of flavors, combining the savory goodness of perfectly fried chicken with the sweetness of our signature donuts creating an unforgettable taste experience,” reads the Federal Donuts & Chicken Franchise Guide.

Donuts: They specialize in spiced cake donuts (not yeast donuts). Hot fresh: Made to order and tossed in house-made sugar blends like Strawberry Lavender or Cinnamon Brown Sugar
Fancy: Thick-glazed donuts with creative, rotating toppings such as Chocolate Peanut Butter or Lemon Meringue

Classic: Donuts covered in old-fashioned milk glazes, like Dark Chocolate Glaze or Vanilla Bean Sprinkle
Fried Chicken: Inspired by Korean fried chicken techniques and twice-fried for maximum crunch
Original Chicken Sandwich: Topped with “Rooster Sauce”
Coffee: Hot or iced, and cold-brewed over six hours to pair with a fresh donut or crispy bite of fried chicken Sources: Federal Donut & Chicken Menu, PAeats.org