Viral cookie chain Chip City abruptly closes all US locations

Chip City, the viral New York bakery chain, has announced it is closing all of its US locations.

“Despite extensive efforts to stabilize our business in the face of significant macroeconomic headwinds, we have made the very difficult decision to close all of our Chip City locations,” the company said on Friday. “We are grateful to our dedicated employees and loyal customers who have supported us for the past 10 years.”

Founded in Astoria, Queens in 2017 by Peter Phillips and Teddy Gailas, Chip City built a cult following around its nearly six-ounce cookies and rotating weekly menu. At its peak it ran more than 50 storefronts in nine states, backed by $17.5 million in funding including a Series B round from Danny Meyer’s Enlightened Hospitality.

By late September its website listed only 24 locations in New York, New Jersey and Texas; its Connecticut and Virginia stores had already closed.

An internal email to staff on Thursday evening said the company would “cease all store operations”, closing its 22 remaining stores at the end of the day. Workers will be paid through 18 October under Fair Workweek policies, and every cookie on the website was labelled “waitlist”.

The shutdown lands days after co-founder Phillips sued Chip City, Enlightened Hospitality and two executives in New York’s Supreme Court.

The collapse mirrors a wider cookie-boom bust: Crumbl, with more than 1,000 stores, has closed at least 57 locations this year, with August traffic down 32 per cent year on year.