Workers Blindsided as Dozens of Locations Suddenly Closed

Workers Blindsided As Restaurant Chain Suddenly Closes Dozens of Locations

(NationRise.com) – A large national restaurant chain shocked workers and patrons after suddenly closing dozens of locations.

Red Lobster closed 50 stores on May 13th with no prior warnings or announcements. Some employees weren’t even aware of the closures until they showed up to work, only to find a sign saying their location had been closed.

The chain will also likely file for Chapter 11 bankruptcy in Florida before the Memorial Day holiday weekend. Executives hope the bankruptcy will help their company consolidate debt and reach deals with landowners who rent out spaces for their restaurants.

Restaurant liquidator TAGeX Brands also announced that it will be selling equipment and furniture used by dozens of Red Lobster locations. Each auction includes the entire contents of the shuttered location. Auctions are being held across the country.

The closures leave Red Lobster with about 600 locations across the United States. It remains among the largest restaurant chains. It earned $2.2 billion in 2023, an 8% loss from 2022. It also fell from being the nation’s 24th largest restaurant chain in 2013 to 41st in 2023. It also suffered significant losses during a promotion in 2023 for endless shrimp.

Red Lobster is just one of many restaurant chains suffering losses in recent years. Consumers are eating out less in an effort to save more as they struggle with record inflation. Some restaurants are slashing prices, while others are closing stores. The company’s website also shows that a total of 87 locations are “temporarily” closed. There is no word yet on how many of those additional locations may close permanently.

Retail stores are also suffering from the fallout of inflation. Over 3,200 physical locations for various retail chains have already closed in 2024. That’s a 24% spike in closures during the same period in 2023. Some large retailers, including Rue21 and Rite Aid, have also filed for bankruptcy. Some chains, including Family Dollar, have also blamed surges in retail crime for their decision to close stores.