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Red Lobster, the iconic American seafood restaurant, is facing rough waters. The company has closed at least 99 locations in 27 states across the United States this year. This news comes after Thai Union, Red Lobster’s major investor, announced its intention to sell its stake in the chain earlier this year.
And now reports are announcing another 50+ locations have reportedly abruptly closed their doors and restaurant liquidator TAGeX Brands is getting ready to auction off the equipment and contents of these locations. The affected restaurants are in Buffalo, Orlando, Jacksonville to name a few and the website lists them as being “temporarily closed”.
TAGeX Brands said:
“These auctions are winner takes all – meaning, each winner will receive the entire contents of the Red Lobster location they bid on.”
The sudden closures surprised both customers and employees alike putting hundreds out of a job overnight. And with no warning.
The closures have left many wondering about the future of Red Lobster. As the company has yet to make an official statement, but the significant number of closures suggests bad news. Some speculate that Red Lobster might be trying to streamline its operations and focus on more profitable locations.
Is Red Lobster Doomed?
The last we heard, Red Lobster was considering filing bankruptcy to restructure debt and discussing their options with a team of lawyers.
One contributing factor to the chains distress, is a reported $11 millions loss after the Endless Shrimp promo launched. The chain also cites lease rates and rising labor costs as reasons they’re in the hole.
Can they pull through this or are we watching the swift decline of a sit-down restaurant heavyweight?
*This is a fast developing story. Check back for more info.
