Red Lobster eyes bankruptcy option after $11M in losses from endless shrimp
Red Lobster eyes bankruptcy option after $11M in losses from endless shrimp
Red Lobster has a new CEO and is focused on possible restructuring through Chapter 11 bankruptcy, according to Bloomberg.
"Last year, Red Lobster reported $11 million in operating losses following its flubbed 'Ultimate Endless Shrimp' deal, which backfired when it reeled in too many customers after the limited-time promo became a permanent menu fixture last June. The restaurant chain later reported $12.5 million in losses in the fourth quarter of 2023."
Endless shrimp.
Ends.
Filing bankruptcy over 11 million? Really? Doesn't seem like a lot for a big restaurant chain.
Well considering that I'm a "millennial" and literally not a single person I know has ever visited, requested, or mentioned Red Lobster as a restaurant choice... they might have deeper trouble than some shitty shrimp. Can't run a business forever when your largest potential market is 65+...
The "endless shrimp" excuse seems like a marketing ploy. Doesn't hit as hard as "no one's coming to our restaurants to eat our shitty food."
I live in Saskatchewan, which is as land locked as it gets in Canada. And for some reason, my city has a Red Lobster. I don't think I've heard anyone talk about going to it because who would expect a seafood restaurant all the way out here to be good? I have no clue how they're making enough money to operate.
(Also, nice pfp! 🐾 )
Once their cheddar biscuits became purchasable on a store shelf, I imagine that decreased the impetus to visit the actual restaurant.
Their biscuits are the best part.
In the late 90s I mentioned never having tried lobster. This resulted in a dangerous u-turn and a drive to the closest red lobster. Only time I went and I forgot until your comment.
I don’t know man. I went to a red lobster once in 2004.
They always had the perception of expensive for me. So growing up, they were a special occasion place to get seafood. I've been a few times in the last few years. Their food was good, but not great and the places were never packed.
Between Red Lobster and almost any other seafood place, the other one would win out for taste and quality.
They had a huge marketing issue, offering "cheap" all you can eat, but making the place look and try to feel like a upscale option when it was basically a seafood Applebee's.
It is peak 90s restaurant culture.
And then in some areas seen as luxury. Same goes for Olive Garden.
this is hilarious fellow millennial, because I just went to Red Lobster today and had a great time.
Of course this was the first time I've been in 20+ years so it's not like I'm a regular.
I've been to red lobster once and spent a very uncomfortable period of time on the porcelain throne shortly after. The news of bankruptcy does not surprise me.
The previous owners purchased the company via a leveraged buyout. It's not one quarters losses, it's the massive long-term debt on it's books.
This is a handy excuse to fuck over employees and suppliers.
It's also really expensive importing biscuits from Cheddar Bay
Why didn't they stop doing it sooner? Lol once they saw it was costing too much they could have retired it and made up some new marketing crap.
Or.. raised the price. You know.. capitalism. They seemed to have failed econ 101. Or the bankruptcy is a good way to get out from under debt and start over. It's the American way.
The endless shrimp reason is just BS.
They're old restaurants and people just don't go there to be "fancy" anymore. Younger people just don't eat a lot of crab, shrimp, and lobster nowadays, and due to ocean issues crab prices and seafood prices have increased even more than beef and other food costs, so they're having to charge more more things fewer people want to go there for. They keep hauling in more and more, but prices have tripled over the past 10 years or so for lobster. Same over the last several years with crab. Especially with the mass die off of snowcrab a year or so ago.
They tried all sorts of tricks actually. But this event brought people in. In the 90’s I’d see it on the local news about the hour long waits and whatnot. This was still true up until the last time I went.
I recall they slowed service, refill limits at a time, even type of order repeat(not getting 10 scampi in a row). I was a fan of the grilled shrimp and as a teen could eat 20 orders (a feat I’m not so proud of now). As an adult I stopped eating there when I realized what I was doing to my body (mid 00s).
I was never asked to leave due to the amount I ate, but I experienced some of these. damn if it wasn’t 5-10 minutes between food, couldn’t order more until you had cleared the only 2 plates allowed at a time, never find the waiter, etc. oh, and they would bring those ungodly amazing biscuits over, “to hold me over”.
I do not miss the man I was back then. I can honestly say I’m half the man I was then.
First time I heard of this, feels like I missed a huge opportunity
Same. I love me unlimited shrampies. I had no idea it was permanent on the menu.
permanent
Well, not anymore...
Same here. It was always overshadowed by unlimited soup salad and bread sticks I guess.
I know right? We should sue them for insufficient advertising.
Every time I went to get a "All you can eat" deal from places that weren't normally a buffet you would have to wait for a waiter to bring you more and the waiter hates the extra trips to the table and/or the owner tells their employees to drag their feet bringing more and makes the amount they bring miniscule. Just an awful experience the couple times I tried.
I don't go out to eat except for a Asian buffet a couple times a year. I'd rather eat cheetos in the basement.
Sorry mcdonalds and taco bell, your shit was barely worth it when it was cheap. Insane prices coming out of the fast food industry these days.
I own a oven and can buy frozen pizzas, get fucked.
Fucking the frozen pizza is slightly better than fucking them straight out of the oven.
The Applebees of the sea.
If that much loss is going to bring down a corporation? Maybe the corpo wasn't being taken care of good enough
But the sign said all you can eat!
the frying dutchman is actually a killer name
What does 11 million dollars in shrimp look like? Let alone 11 million in losses, how much god damn shrimp is that? Was cocktail sauce calculated into this?
The cost here for shitty frozen shrimp is about $13 for 2lbs of "31-40" (31-40 shrimp per lb); at that cost, averaging 35 shrimp per pound, you could buy approximately 29,615,385 shrimp, which would weigh around 400 tons. I think I did that math right. It's late.
I've only gone to red lobster for the endless shrimp (though there are much better all-you-can-eat options out there). They should try making their regular offerings better. It also doesn't help that private equity is in the middle of raiding the company and that's probably the main reason they're currently eyeing bankruptcy.
Same with olive garden they want the decades old prime real estate. They could give a fuck about the restaurant
I'm not surprised. Every endless seafood deal Red Lobster did lost money.
Red Lobster: “Endless Shrimp”
Ocean: “Dude… no.”
Some people can't help themselves at the seafood buffet
I do it all for the skrimpz
Did they learn nothing from The Simpsons?
Man. They always do everything first.
Yep Simpsons already did it https://youtu.be/PHr-C-qIfRU
That's what they get for offering 30 shrimp for just $10.99 and fueling people's addictions...
privatize the profits, publicize the losses.
If they are going into chapter 11 then the losses are privatized. Chapter 11 halts debt collection temporally while restructuring happens. Afterwords the previous owners own none of the company or a much reduced chunk of the company. The previous debtors now own most or all of the company. Similar to a bank repossessing a house it's debtors repossessing a business.
It's also possible for the judge or who they appoint to run the bankruptcy too determine there isn't any hope saving the business and convert it to a chapter 7 which is close everything and sell off the assets to try and pay back the debtors.
Either was the original owners usually get little to nothing.