A STRING of iconic restaurant chains are permanently closing their doors amid ongoing economic uncertainty causing headaches for diners.
Some of America’s most beloved franchises have shut down 135 locations in recent months citing labor shortages, rising wages and inflation.
Experts say the restaurant industry is facing a complex set of challenges, which are hitting mid-range chain restaurants the hardest.
While some closures are due to underperforming locations or mismanagement, many are struggling with increased competition in the sector.
Hooters shocked diners in March after declaring bankruptcy in a bid to address its $376 million debt burden.
It cited declining consumer spending and rising costs as a major reason for the filing.
It closed a number of locations as part of the restructure plan, including 30 locations across multiple states in June.
‘DIFFICULT DECISION’
After announcing the surprise shut downs, a Hooters spokesperson said it was a “difficult decision”.
“Importantly, Hooters is here to stay, and by optimizing our business in support of our long-term goals, Hooters will be well-positioned to continue our iconic legacy under a pure franchise business model,” the spokesperson said.
“We are committed to supporting our impacted team members throughout this process and are incredibly grateful to our valued customers for their loyalty and dedication to the Hooters brand.”
Earlier this year, beloved chain Red Robin confirmed it would shut about 70 underperforming locations in 2030, with 10-15 scheduled for closure this year.
In an earnings call announcement at the end of 2024, Red Robin CEO G.J. Hart said it was “evaluating alternatives” for the locations including closure upon the expiration of their leases.
Hart told the webcast the closures would help pay off debts and reinvest in remaining restaurants.
Red Robin, which operates about 500 restaurants throughout the US and Canada, said the brand planned to add new menu items throughout the year in a bid to lure back diners.
SEE YOU NEVER
Lastly, iconic brand Denny’s confirmed plans to shut up to 90 locations by the end of the year, as part of a broader strategy to revitalize the brand and improve financial performance.
It brings the number of closures to about 180 locations since 2024.
Restaurant closures in 2025
Denny’s – Denny’s has confirmed that up to 150 locations are set to close in the US by the end of the year as many of them are no longer profitable.
Red Lobster – The chain has said that it plans to close over 100 stores across the country this year as new CEO Damola Adamolekun takes over.
TGI Friday’s – TGI Friday’s is still being forced to shutter locations thanks to a bankruptcy filing, including 30 in April alone.
Applebee’s – This chain is projecting a loss of 20 to 35 Applebee’s spots in 2025 but is teaming up with IHOP to introduce dual-branded locations with a curated menu of the two’s best items.
Noodles & Company – This emporium is set to close between 17 and 21 locations in 2025 following a difficult 2024.
Announcing the shut downs, Denny’s CFO Robert Verostek said the decision would improve the company’s cash show and allow it to reinvest in busier locations.
“In any mature brand, when restaurants have been open that long, it is natural that trade areas can shift over time,” he said.
A majority of the closing locations on the list had been operational for around 30 years.
The company is also assessing and making improvements to about 265 other locations as it completes a full “portfolio optimization” to bring in more money at every Denny’s restaurant.
Despite these closures, the company plans to open up to 40 new locations.
Verostek also noted that there were sharp sales declines in January and February due to consumer uncertainty.
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