UpTrajectory Review

Crumbl, the fast-growing cookie franchise that built its brand on oversized, rotating-menu indulgences, is showing serious strain. According to reporting from TheStreet, an internal company document obtained by Restaurant Business revealed that August sales were down 70% compared to two years prior. Foot traffic across Crumbl's more than 1,000 locations dropped 32% year over year, based on Placer.ai data. The fallout has already hit franchisees: one location in St. Matthews, Kentucky, operated by Red Sheep St. Matthews LLC, shut down and filed for Chapter 7 bankruptcy with over $352,000 in liabilities. This isn't a story about one weak operator. It's a signal that a business model built on premium-priced, non-essential treats is colliding with a harsher consumer environment.

For small business owners, Crumbl's troubles are a case study in how quickly demand can shift when your product sits squarely in the discretionary category. A $5 cookie isn't a necessity. When customers feel squeezed by inflation and rising household costs, that's exactly the kind of purchase they cut first. Zions Bank economist Robert Spendlove told KSL that consumers are under constant pressure from higher prices, and that sentiment is shaping spending habits. If your business relies on impulse buys, premium pricing, or 'treat yourself' psychology, Crumbl's collapse is a direct warning. It shows how vulnerable single-product or luxury-positioned businesses can be when the economic mood turns cautious.

What makes this story especially notable is the role of GLP-1 drugs like Ozempic and Wegovy. The author, who is personally taking one of these medications, points to a PwC survey showing that 61% of current GLP-1 users are buying fewer sweet treats, and 56% are cutting back on salty snacks. This is a structural shift in consumer behavior, not a passing trend. Millions of Americans are using these drugs, and they're eating less, snacking less, and rethinking indulgences altogether. For food businesses—especially those centered on desserts, snacks, or large portions—this is a new baseline. It's not just about economic cycles anymore; it's about changing appetites driven by medication.

The impact isn't evenly distributed. Large chains with diversified menus and strong balance sheets may weather this storm. But franchisees—often small business owners who invested heavily in a single concept—are the ones filing for bankruptcy. Crumbl's rapid expansion model encouraged aggressive growth, but when sales dropped, individual operators were left exposed. This raises hard questions about franchising as a path to entrepreneurship. If the parent company pushes expansion without accounting for shifting consumer behavior, franchisees absorb the risk. The same dynamic could play out in other franchise systems built on indulgence: ice cream, specialty coffee, gourmet donuts. The warning extends beyond cookies to any business whose margins depend on high volume and high price for non-essential goods.

What should small business owners take from this? First, audit your product mix. If more than half your revenue comes from items customers can easily skip, diversify or introduce value-oriented options. Second, pay attention to health trends that affect consumption patterns. GLP-1 usage is growing, and its impact on food demand will only deepen. Third, if you're considering a franchise, look beyond the brand's hype. Ask how the company supports franchisees during downturns, and whether its model accounts for long-term behavioral shifts. Crumbl's collapse isn't just a cookie story—it's a reminder that consumer psychology, health trends, and economic pressure can converge fast. Businesses that ignore those signals do so at their peril.

Takeaway: If your business depends on discretionary, indulgence-driven purchases, diversify now—GLP-1 drugs and inflation are permanently reshaping consumer appetites.