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By Neirin Gray Desai For Dailymail.Com
18:04 01 Apr 2023, updated 18:08 01 Apr 2023
- Many US restaurant chains have continued to shrink since the pandemic
- Those affected include: Burger King, IHOP, Ruby Tuesday, Denny’s and Quinzos
- Some have attempted to roll out electronic ordering systems to cut costs
Scores of US restaurant chains are axing locations around the country to streamline operations and cut costs.
Although modern chains like Chick Fil-A and Sweetgreen have successfully captured swathes of the US restaurant market, some legacy outlets were irreversibly damaged by the Covid pandemic and labor shortages.
To keep up, some stores deployed touchscreen ordering systems to reduce staff requirements but ultimately many brands and large franchisees were forced to declare bankruptcy.
A compilation of reports reveals the scale of those closures – and suggests that for many, choppy waters lie ahead.
Applebee’s
Applebee’s has closed around 300 stores since 2016 – and although it earlier said it was hoping to finally expand in 2023, those plans appear to have changed.
Tony Moralejo, company president, said on an earnings call at the beginning of March that building new restaurants was too expensive and that launching additional stores was going to be hard.
In 2022 the chain opened four US restaurants but closed 13, leaving it with a total of 1,569.
It has not been without controversy, and came under fire last year when a franchise owner suggested using inflation as an excuse to lower staff wages.
The chain was also forced to apologize after it aired a light-hearted ad during live coverage of the Ukraine invasion.
Boston Market
After experiencing its glory days in the 1990s with around 1,200 locations in 1997, Boston Market is now down to about 330 restaurants in the US.
Once famous for serving rotisserie chicken, the dish’s availability in supermarkets across the country has caused the restaurant’s position in the market to become questionable.
In 2021, labor shortages put pressure on workers and led to an employee walkout, according to Insider, which resulted in the closure of ten percent of all stores.
‘We must take steps to ensure our operational structure will support long-term sustainability,’ CEO Frances Allen said in a letter at the time.
‘Part of that effort involves continuously analyzing our geographic footprint and real estate portfolio to assess the ongoing viability of locations.’
Buffalo Wild Wings
Despite its popularity, this chicken restaurant and sports bar has also been closing stores – but has retained over 1,000 around the country.
According to ScrapeHero data from the beginning of March, the chain now has 1,234 locations – around 45 fewer than the 1,279 it had in November 2020. But that’s a fairly small change compared to other restaurants that have shrunk operations.
Locations in Colorado, Illinois, Florida and Virginia have all closed in the last year.
The brand made headlines earlier this year with its cheeky response to a frivolous $9million lawsuit from a customer frustrated that the boneless wings on the menu were not actual wings.
Burger King
This week Burger King, once the US’s second-largest burger chain, announced it would lay off 424 staff members as it gears up to shutter 26 restaurants, mainly in the Detroit area.
Store closures began on March 17 and will continue through next month as the chain shuts doors due to ‘unforeseen business circumstances’, it said.
The announcement came just months after a major Burger King franchisee TOMS King Holdings in January filed for Chapter 11 bankruptcy.
In 2018, it was once touted as one of the top Burger King franchisees in North America, but announced it would close 90 of its locations across Pennsylvania, Virginia, Ohio, and Illinois as part of the bankruptcy.
Cracker Barrel
The restaurant is so beloved by one couple – who met in a Cracker Barrel by chance in 2020 – that they got engaged in the same location a year later.
However, last week the chain announced it would be closing three outlets, meaning it will no longer have a presence in the Portland area of Oregon.
‘We are saddened that we have been unable to overcome the impact the pandemic had on our business and have made the difficult decision to close the Beaverton, Tualatin and Bend locations,’ a spokesperson said.
In December it closed another branch in Oregon. The company said at the time that the closure was merely caused by poor performance, but employees told local channel KGW8 it was spurred by concerns over safety.
Despite these recent closures, Cracker Barrel says it’s seeking to increase its current count of around 665 locations by more than a dozen by the end of the year.
Denny’s
Although Denny’s had more than 1,600 locations in the US in 2017, its count was down to 1,445 in 2022, according to data from Statista.
Managing those restaurant locations after the onset of the pandemic became increasingly hard, as the chain suffered staffing issues.
Even a visit from Kanye West, who stopped by for some breakfast after son Saint’s soccer game, couldn’t help its fortunes.
A video even went viral in August in which two members of the public went to help a lone Denny’s employee in the kitchen as they were so understaffed.
Last September another five different Denny’s locations closed, according to Mashed.
A lawsuit forced locations in North and South Carolina to close, while local outlets in Connecticut, Portland and New York were also required to shutter.
Friendly’s
One of the oldest restaurants on the list, Friendly’s opened in Springfield, Massachusetts, in 1935 as an ice cream shop, before expanding its menu to include burgers and fries.
Like many other restaurants, however, it filed for bankruptcy in November 2020 and closed in multiple locations.
But its woes had begun prior to the pandemic. In 2019 it closed 14 locations in New York State.
IHOP
IHOP, a sister company to Applebee’s, also appears to be facing growth issues. Last year it had planned on opening around 60 branches but ended the year with a reduced target of about 40.
Many of those openings were pushed back into 2023, president Jay Johns said in March, and the company will focus on retrofitting old structures as opposed to building them from scratch, Restaurant Business reported.
‘That’s how we’re combating the economic factors of, it costs so much to build a building right now,’ said Johns.
IHOP has operated successfully for about 64 years, since 1958, and although around 200 stores were closed due to the pandemic, it still has more than 1,600 branches in all 52 states.
And it remains hugely popular – Bruce Willis was spotted in an LA IHOP last summer, three months after he’d announced he was retiring from acting.
And two prisoners who broke out of a Virginia prison using toothbrushes last month were busted nine hours later tucking into pancakes at an IHOP six miles away.
Jack in the Box
There are now nearly 2,200 locations of this burger joint, mainly on the west coast, in parts of Texas, and the Midwest, and is a celebrity favorite with the likes of Elon Musk, Kim Kardashian and Britney Spears.
However, the owner of at least 70 Jack in the Box restaurants between Missouri and Illinois filed for bankruptcy in February 2021, citing labor issues at the time. In court documents it was also said that increased fast-food competition contributed to the issues.
In the last year at least four locations around the St. Louis, Missouri, area have also permanently closed, according to local outlet KSDK.
Ruby Tuesday
Founded in Knoxville, Tennessee, in 1972 as a restaurant serving typical American cuisine, Ruby Tuesday grew to have hundreds of locations across the eastern states.
In the late 2000s it operated 840 locations, according to Restaurant Business, but over the course of the next decade it closed nearly 400 restaurants.
Months after the onset of the Covid pandemic, it filed for Chapter 11 bankruptcy and closed another 185 restaurants, leaving only around 236 remaining. Then in 2021 it left Chapter 11 but was down to 209 stores.
In January the last remaining Ruby Tuesday in Wisconsin closed, according to the Milwaukee Journal Sentinel.
In February, it was reported that another restaurant in Connecticut was going to be replaced by a Texas Roadhouse within two years, The Middletown Press reported.
Steak ‘n Shake
Steak ‘n Shake had more than 600 stores around the country in the first quarter of 2019, but Covid setbacks forced it to close nearly 60. Then in 2022 the burger chain shut another 30, but was able to stay in profit.
That may have been facilitated in part by the deployment of a counter-service model involving kiosks.
The company has invested $50 million in the kiosks, which CEO Sardar Biglari said was important for the chain to keep up with competitors offering fast service.
Unlike many of the other chains, Steak ‘n Shake experienced growth to its restaurant count in the second half of the last decade, peaking in 2018 with 626, according to Restaurant Business.
Subway
Despite being the largest restaurant chain in the US, Subway has closed around 25 percent of its branches over the past five years.
There are now around 20,600 Subway stores in the country as of February 27, according to ScrapeHero, down from nearly 26,000 in 2017.
The continued closures come as somewhat of a surprise, as an enormous menu refresh in 2021 that brought BelGioioso Fresh Mozzarella and Hearty Multigrain Bread to the restaurant was regarded as a great success, according to Mashed.
Sales were boosted by nearly 33 percent in some locations, according to Eat This, Not That. But franchisees had been complaining that owning restaurants was becoming increasingly difficult, in part due to the number of branches, causing the chain to place less attention on its store count.
‘We just want to focus on quality in the footprint in the U.S. as opposed to quantity,’ its CEO John Chidsey told the publication.
In January, it was reported to be exploring a sale that could value the chain at $10 billion, making the two secretive families of its founders billionaires.
The chain even talked of reinventing itself as a roadside ‘oasis’ – complete with EV charging stations, picnic tables and playgrounds – as it sought a buyer.
But it has been plagued by controversies over the years, not least ‘tunagate’ – a claim that its tuna subs had no tuna in them – and a child porn investigation involving its former spokesman Jared Fogle.
TGI Fridays
International restaurant chain TGI Fridays, which has been around since the 1960s, may be on the brink of disappearing forever.
It has been yet another fast food outlet to suffer a huge blow in the US due to the Covid pandemic. In May 2020 it was announced that the company would close as many as 20 percent of its 386 locations, Bloomberg reported at the time.
Closures have continued into 2023, with Massachusetts and Texas announcing they would be shutting their doors permanently in just the last month.
There were 289 TGI Fridays stores in the US as of March 8, according to ScrapeHero.
Quinzos
Sandwich chain Quinzos has suffered a huge contraction since its glory days in the mid 2000s, when it had 5,000 locations around the country.
By 2010 that number was down to 2,800, and in 2016 just 671, according to Restaurant Business. In 2021 the chain was generating less than $100 million a year in sales and operated only 255 US locations.
According to the latest data from ScrapeHero on March 14, it was down to 153 locations.
In 2015, Quiznos clashed with an unlikely adversary, when it teased the Burning Man festival in a parody ad, calling it ‘a place for rich people to check off their bucket list.’
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