Taylor Chip, the Pennsylvania-based cookie company known for its oversized, gooey treats, has filed for Chapter 11 bankruptcy protection with more than $2.5 million in debt and just $400,000 in assets. The Lancaster County business, founded by Sara and Doug Taylor in 2018, gained popularity for flavors like Lava Cake and Salted Caramel Pretzel, often drawing comparisons to national chain Crumbl.

Despite rapid expansion into Philadelphia and other markets, the company faced mounting financial challenges. The Taylors attributed their troubles to significant permitting delays in Philadelphia, where two locations opened nearly two years behind schedule after leases were signed in late 2022. Without outside investors, the couple relied on creative financing to stay afloat, but the delayed stores couldn't generate enough revenue to cover mounting expenses.

Taylor Chip plans to refocus on its rural Pennsylvania roots, keeping locations in Manheim Township, Gordonville, Hershey, and York open while expanding online sales and developing a nutrition line. The founders emphasized that Chapter 11 restructuring offers a path to survival rather than closure. With a $1.8 million SBA loan still outstanding, the company aims to protect its brand and team while rebuilding for the long term.