Oberweis Dairy Files for Bankruptcy After Nearly a Century in Business

Oberweis Dairy Inc., a family-owned dairy based in North Aurora, Illinois, has filed for Chapter 11 bankruptcy protection. The company, which has been in operation since 1927, offers home milk delivery in glass bottles and operates over 40 ice cream and dairy stores across Illinois and Missouri.

The bankruptcy filing, made on Friday in the U.S. Bankruptcy Court for the Northern District of Illinois, aims to reorganize and restructure the company’s financial affairs. Oberweis Dairy has listed its assets and liabilities as between $10 million and $50 million and reported having up to 5,000 creditors. The company has stated that funds will be available for distribution to unsecured creditors.

Among its top unsecured creditors are Nussbaum Transportation, owed over $774,000; Greco & Sons, owed nearly $722,000; and Penske Truck Leasing, owed more than $132,000. Additionally, Oberweis Dairy owes over $173,000 to the Cook County treasurer’s office in Chicago.

The company’s financial challenges come at a time when traditional dairy products face increasing competition from plant-based milks such as almond, soy, and oat milk, which have gained a growing market share.

Oberweis Dairy is owned by the family of former Illinois state Sen. Jim Oberweis, who bought the company in 1986 and has served as chairman for 37 years. Oberweis has also been active in Illinois politics, serving in the legislature from 2013 to 2021 and running for various political offices over the years.

In recent years, Oberweis Dairy received a $90,000 grant from the U.S. Department of Agriculture in December 2022 and a $5.67 million loan from CIBC Bank of Chicago through the U.S. Small Business Administration’s Paycheck Protection Program in April 2020.

The exact reason for the dairy’s bankruptcy filing remains unclear, but the company’s financial struggles highlight the challenges faced by traditional dairy producers in an evolving market landscape dominated by plant-based alternatives.