It would have been easy for the leadership team at Saladworks to hide out in their offices at the company’s headquarters in Philadelphia, wallowing in consternation after their company filed for bankruptcy in 2015 following an ownership dispute.

Instead, they grabbed their smartphones and headed out to visit all types of restaurants—from quick serve to fine dining—taking photos of design elements that they liked and disliked and putting them in a three-ring binder with handwritten notes. The team gave this binder to a Mobile, Alabama–based architect, whom they hired to help create a new restaurant design.

“We’re not architects. I’m a restaurant dude. I grew up in restaurants,” says president and CEO Paul Steck. “It was really cool. It sounds so informal, but it really works.”

In addition to the in-store research, the team took advantage of the bankruptcy by embarking on an effort to reinvigorate the brand with changes to its menu, logo, and overall image. Centre Lane Partners, a private investment firm based in New York, purchased Saladworks last June, infusing the brand with cash and promoting Steck, who was already president, to president and CEO.

“It’s been a feverish-paced process, but one that has been a lot of fun,” Steck says. “We’re a 30-year-old brand this year, but we needed to feel young. I didn’t want to feel that we are a brand that was tired and washed up.”

For quick serves like Saladworks to survive and thrive after bankruptcy, they must develop a strategy to address the root causes that got it there in the first place, says Jesse York, a director at Conway MacKenzie, a national financial services firm.

York, who focuses on restructuring companies, says that if used correctly, bankruptcy can be a strategic tool in executing a turnaround plan that makes the company a healthier organization. However, many companies do not prepare properly or follow through.

“A lot of times people misuse it and they don’t plan appropriately and go into bankruptcy with a short-sided plan or no plan at all,” York says. Conversely, a strong post-bankruptcy strategy for restaurants typically encompasses a deeper examination, resulting in changes to business processes, relationships with vendors and leasers, and marketing and branding initiatives like menu or design revamps.

Steck says Saladworks was largely stagnant in the two years leading up to the bankruptcy and subsequent purchase by Centre Lane. As a result, it was imperative to quickly develop a series of strategies that would propel the company forward.

“In business, doing nothing means you are moving backward rapidly,” Steck says.

A similar effort has been underway at Quiznos, which filed for Chapter 11 bankruptcy in 2014 after accumulating about $400 million in debt. Since then, Quiznos has partnered with Tesser, a firm based in San Francisco, to revitalize its restaurants with a fresh design, layout, and décor in order to make the brand more relevant. Several locations in the Denver area are serving as a testing ground for changes.

“As we think about bringing Quiznos forward, the place, the physical design, is a big part of the Quiznos experience,” says Quiznos president and CEO Doug Pendergast. “One of the many things that the filing and restructuring allowed us to do was completely unwind the former supply chain model.”

Before the bankruptcy, franchisees dealt with a supply company that was part of Quiznos. Now they buy from third-party suppliers and Sysco, which has a distribution agreement with Quiznos. These changes to the supply chain have reduced the cost of goods sold by 3.5 percent in some cases.

Quiznos also set out to create a simpler menu that was easier to execute for workers and franchisees, while also tweaking ingredients and portion sizes. Franchisees have reported that it’s now easier to train new team members on the recipes; this ease of execution has even allowed some to cut labor costs. Pendergast says the menu changes have also resulted in greater consistency in the kitchen, quicker order preparation, and more positive feedback from customers.

“We think that core promise is still relevant,” he says. “What we are embarking on is a systematic approach to make more relevant the way we deliver on that promise.”

Although Quiznos has made several improvements, Pendergast says, the brand never wavered from its original mission of delivering flavorful sandwiches to its guests.

Strong internal and external communications with stakeholders and customers are another vital ingredient for any brand going through a bankruptcy, York says.

“The consumer cares less about the bankruptcy and more about what image you are selling and what you are trying to do,” York says. “You have to build trust back with your key stakeholders. … It’s key to restore that, and it’s a necessary component when coming out of bankruptcy.”

As for Saladworks, it has been much more franchise-centric during the process. The company invited franchisees to join a task force examining how to keep its ultra-loyal customer base happy while revising the menu to embrace new trends and ingredients like Brussels sprouts and roasted butternut squash.

“The bankruptcy process is oftentimes described as a cleansing; it allows you to come out of it not worried about the past,” Steck says. “When you come out of bankruptcy, you better be flying, because you have a window of opportunity to make significant changes to a brand that can be meaningful for many years to come.”

Finance, Story, Quiznos, Saladworks