A high-profile group of plant based restaurants made headlines for filing for bankruptcy last month.
Planta, who launched in 2016 (the same year we took over Alice & Friends in Chicago) grew fast. In less than a decade, they opened 18 locations across major cities like New York, Toronto, and Miami.
Many of us in the vegan food world watched them with a mix of admiration and curiosity: could a fully plant-based concept go mainstream? But behind the scenes, they were reportedly facing between $10 million and $50 million in liabilities, with almost no assets left.
Plant Based Restaurant Challenges That the Public Doesn’t See
Most people see the fun parts of running a vegan restaurant: flavorful dishes, friendly staff, and happy customers taking photos of decadent vegan food and desserts. What they don’t always see is how quickly it can become fragile.
Restaurants that serve 100% plant based food don’t have the luxury of massive margins. At Alice & Friends, most of our ingredients are fresh, vegan cheeses are made inhouse, and plant-based proteins are good quality (and costly). We prepare most menu items from scratch and that requires additional labor. And labor requires money.
In fact, for the first years after taking over Alice and Friends in 2016, our restaurant owner, Mun Wong, was present at our Chicago location almost every day. She tells us regarding those days:
“I lost so much money the first five years and worked from 8:00am to 11:00 p.m. every day. I went to my primary job in the morning and Alice & Friends in the evening. If I didn’t have the passion to promote veganism, there’s no way I could do this.”
Running a vegan restaurant (especially a small independent one) is a daily exercise in patience and resilience. The excitement has to be backed up by A LOT of work.
Why Growth for Plant Based Restaurants Can’t be Rushed
We’ve been asked many times why we don’t open more locations, or expand to other cities. The answer is simple: it’s really hard to grow a vegan restaurant in today’s market. Not because people don’t care but because the economics still don’t quite work in our favor.
Here are just a few of the challenges of owning a vegan restaurant:
Niche audience. The plant-based industry continues to grow but fully committed vegans still represent a small portion of the population. Many of our customers love plant-based food and are also vegetarians, flexitarians, or enjoy eating meat. We’re grateful to have this diverse support of customers but it also means that consistent foot traffic is unpredictable.
Expensive ingredients. As we previously mentioned, vegan ingredients aren’t cheap. Specialty items like non-dairy milk, meat/egg substitutes, and fresh produce often cost more than their animal-based counterparts. With inflation playing a role in the mix, prices have increased everywhere in the past 5 years by 25%-35%. In addition, labor shortages in the food industry continue to raise salaries.
Brand perception. To attract new guests, we have to make vegan food feel accessible without being preachy. At the same time, we carry the weight of being “perfect” in some people’s eyes.
Ever wonder why Vegan restaurants that change their menu to include meat also fail? Aside from it being perceived as a “betrayal”, customers have higher expectations from us than a restaurant who serves animal products to maintain ethical and environmental practices. At our restaurant, we’re committed to serving a 100% vegan menu, composting practices, and donations to organizations that align with our values. It can be a lot to juggle but we do it because we truly believe in what we do.
Limited investment support for vegan restaurants.
Many investors still see vegan restaurants as a trend, not a long-term investment. That makes it more difficult for places like Planta, or a smaller businesses like us, to access the capital needed to grow safely. This is a big reason why we take the time to grow slowly.
Alice & Friends is 100% financed with self-invested loans. This is a route that gives business owners more flexibility but it also comes with risks.
“If it wasn’t because my husband and I kept our day jobs at our separate and more predictable business, it would be difficult to support all of our family needs.” _ Mun Wong, owner of Alice & Friends
Nonetheless, it doesn’t mean that we are immune to closing, but we recognize that growth is a process that you can’t rush. This month, we opened our third location in Illinois at 104 N Marion St in Oak Park. It is a major milestone for us with mixed feelings of excitement and just the right amount of fear to keep us grounded.
Lessons we can Learn from Planta
The Challenges Planta is facing isn’t a failure of veganism. It’s a reality check on how difficult it is to scale something that’s still finding its place in the mainstream. They had the brand, style, and menu. But even that wasn’t enough to protect them from economic headwinds, rising costs, and the complexity of running a hospitality business in 2025.
What we take away from their story is this: growth is not the only measure of success. Sometimes staying small, staying connected, and staying local is not just safer but better in most cases.
What Motivates us to Continue Promoting Veganism
Every time someone walks into Alice & Friends and tells us it’s their first time trying vegan food (and that they loved it) we’re reminded of why we do this. Every time a regular brings a skeptical friend, or a family celebrates a birthday with us, we feel pride that no balance sheet can measure.
Yes, it’s tough but we still believe that kindness, compassion, and good food can make a difference. Our mission is still worth it.