Get All Access for $5/mo

Cupcake Chain Crumbs Closes All Stores A week after being delisted from Nasdaq, Crumbs has abruptly closed all 65 locations nationwide.

By Kate Taylor

Opinions expressed by Entrepreneur contributors are their own.

The nation's largest cupcake chain is no more.

On Monday, Crumbs Bake Shop notified all employees that it would be closing all 65 stores at the end of the business day, reports The Wall Street Journal. The company is now evaluating its limited remaining options, including bankruptcy.

Crumbs' shop closure comes on the heels of its delisting from the Nasdaq on July 1. The exchange's decision to force Crumbs to delist stemmed from Crumbs' failure to meet the minimum $2.5 million stockholders' equity requirement.

Until today, Crumbs was the largest cupcake chain in America. However, as the cupcake craze has died down, the chain has struggled in an overcrowded marketplace. In the first three months of this year, the company's net loss widened to $3.8 million from $2 million the same period a year ago. Sales were at $9.1 million, down 25 percent from a year ago.

Related: Cupcake Chain Crumbs Delisted From Nasdaq

With little hope for the future – Crumbs stated in May that it expected to record net losses in future periods – the drastic move of shutting down shops seemed like the only solution. Indeed, shops were already shutting down on their own accord, with seven underperforming stores closing in the month and a half from the end of March to mid-May.

Crumbs, which began as a single bakery in New York City in 2003, debuted on the Nasdaq in June 2011 at $13.10. When the delisting announcement was filed on June 26, shares were trading at 23 cents. Shares ended the day on June 30 at 4 cents.

However, even as media outlets cite Crumbs' downfall as a sign of the end of the cupcake era, competitors are convinced that the cupcake isn't dead. Some are diversifying: Sprinkles branched out into ice cream and cookies in May 2012. Others are just getting started: following three victories on Food Network's Cupcake Wars, Sweet Arleen's began franchising last year and believes that the franchise is on the cusp of national growth.

"Cupcakes are a staple of the dessert landscape in the U.S., and they're always going to be," Georgetown Cupcakes co-founder Sophie LaMontagne recently told Entrepreneur.com. Crumbs may have crumbled, but other cupcake stores are confident that the bite-sized treat will never die.

Related: Georgetown Cupcake Founders: We're Living Proof That the Cupcake Isn't Dead

Kate Taylor

Reporter

Kate Taylor is a reporter at Business Insider. She was previously a reporter at Entrepreneur. Get in touch with tips and feedback on Twitter at @Kate_H_Taylor. 

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Side Hustle

At Age 15, He Used Facebook Marketplace to Start a Side Hustle — Then It Became Something Much Bigger: 'Raised Over $1.6 Million'

Dylan Zajac, now a 21-year-old senior at Babson College, wanted to bridge the digital divide.

Side Hustle

'I Just Hustled': She Earned More Than $300,000 Wrapping Gifts Last Year — and It All Started With a Side Hustle

When Michelle Hensley lost her husband to cancer, she needed to figure out how to earn an income for her family.

Franchise

McDonald's Announces the Return of the Snack Wrap in 2025 — Here's What to Expect From Its Comeback

The decision comes after years of persistent customer demand for the portable snack, which debuted nearly two decades ago.

Business Ideas

63 Small Business Ideas to Start in 2024

We put together a list of the best, most profitable small business ideas for entrepreneurs to pursue in 2024.

Business News

OpenAI Just Released Its Text-to-Video Generator, Sora. Here's How the New AI Could Impact Small Businesses and Creators.

Sora has a variety of use cases for businesses, from social media campaigns to video creation.

Innovation

These Entrepreneurs Created a League That Turns Gamers Into Pro Race Car Drivers: 'We're Giving Drivers a Sustainable Career Path'

Racing Prodigy's innovative E2Real sports league is lowering the high-cost barrier to entry for drivers to take their passion to the track.