A harsh year for the dining establishment sector led several chains to shut underperforming places in 2024, as they attempt to enhance their sales in the years ahead.
Inflation- fatigued customers drew back their dining establishment investing in 2024 and rather looked for worth and discount rates when they did select to eat outside their homes. Overall united state dining establishment check outs succumbed to the initial 10 months of the year, according to information from sector tracker Black Box Intelligence.
The decrease in dining establishment investing brought about weak sales and a rise in insolvencies for the sector. Twenty- 6 dining establishment business declared Chapter 11 insolvency defense in 2024, almost triple the variety of filings in 2020, throughout the elevation of the pandemic.
With couple of exemptions, casual-dining chains specifically had a hard time to draw in consumers, including in the sector’s difficulties that have actually installed because theGreat Recession Since the surge of fast-casual chains, several restaurants have actually chosen the benefit and assured top quality of gamers like Chipotle or Sweetgreen over the casual-dining chains that controlled in the previous years.
Here are the dining establishment chains that revealed closures in 2024:
Wendy’s
The Wendy’s logo design is seen on an indication outside the dining establishment inMuncy
Paul Weaver|Lightrocket|Getty Images
In late October, Wendy’s announced it would shutter 140 underperforming locations by the end of the year, in addition to the roughly 80 closures it had in the first three quarters.
Executives made the decision to prune some outdated restaurants that had annual unit volumes of about $1 million each to improve the company’s overall footprint.
Despite the closures, the company expects to end 2024 with an unchanged restaurant count, thanks to its new restaurant openings, Wendy’s CEO Kirk Tanner told investors on the company’s third-quarter earnings conference call.
Applebee’s
A sign is posted in front of an Applebee’s restaurant on June 12, 2024 in Hayward, California.
Justin Sullivan | Getty Images
In May, Applebee’s parent, Dine Brands, said it planned to shutter between 25 and 35 of the brand’s U.S. locations. By late September, Applebee’s global unit count had fallen by 36 locations compared with the year-ago period.
Applebee’s same-store sales have declined for the last six straight quarters, according to company filings.
Dine Brands, which also owns IHOP, has closed more stores than it has opened every year since 2016, with the exception of 2022.
Denny’s
In an aerial view, customers enter a Denny’s restaurant on February 13, 2023 in Emeryville, California.
Justin Sullivan | Getty Images
Denny’s closed about 50 locations in 2024 and plans to shutter an additional 100 restaurants by the end of 2025. Including this year’s closures, the 24-hour diner chain still has roughly 1,300 open locations.
The restaurants marked for closure are in the lower third of the chain’s performers, with annual unit volumes of $1.9 million to $2 million, executives said at the company’s investor day in October. Once those restaurants shutter, Denny’s expects that both its same-store sales and annual unit volumes will improve. In its latest quarter, the chain’s same-store sales were roughly flat.
After 2025, Denny’s plans to open between 45 and 50 net new locations annually.
TGI Fridays
TGI Fridays logo is seen on one of their branches.
John Lamparski | Lightrocket | Getty Images
In November, TGI Fridays joined the slew of restaurant companies that filed for bankruptcy protection. But before it filed for Chapter 11, it shuttered 86 restaurants, starting with 36 closures in January and another 50 in late October.
The last round of closures took the chain’s footprint down to roughly 160 open locations worldwide. But the count could dwindle more. A bankruptcy court in Texas will determine TGI Fridays’ future, which could mean closures for the chain.
Red Lobster
The exterior of a Red Lobster restaurant on May 20, 2024 in Austin, Texas. Red Lobster has filed for Chapter 11 bankruptcy protection after a failed lease-back agreement and “endless shrimp” promotion backfired against company revenue.
Brandon Bell | Getty Images
Red Lobster permanently shuttered more than 120 restaurants in 2024.
The seafood chain closed roughly 100 locations before it filed for Chapter 11 bankruptcy protection in May. Before it exited bankruptcy with a new owner and CEO, the company rejected the leases of another 23 restaurants.
But with 2024 now in the rearview mirror, Red Lobster is hoping that a comeback — with no more restaurant closures — is in its future.
Noodles & Co.
Michael Siluk | UCG | Universal Images Group | Getty Images
Fast-casual chain Noodles & Co. announced in August that it would close roughly 20 locations after reviewing its entire 475-restaurant footprint.
The review was part of the company’s efforts to improve its operations and finances after a rocky few years. Noodles & Co. has also been overhauling its menu, cutting items that don’t sell and adding new entrees that might appeal to more customers.
But the turnaround will take time. In its latest quarter, the company said same-store sales fell 3.3%.
Bloomin’
Customers arrive at an Outback Steakhouse restaurant on November 02, 2021 in Skokie, Illinois.
Scott Olson | Getty Images
Bloomin’ Brands, the parent company of Outback Steakhouse, Carrabba’s Italian Grill and Bonefish Grill, shuttered 41 underperforming restaurants in 2024.
The closures affected older locations with leases dating back to the 1990s and early 2000s, executives said on the company’s earnings conference call in February. To make the decision, the company weighed the locations’ sales and traffic, as well as the cost of investments to improve the locations. Most of the closures were Outback locations.
Like many other casual-dining companies, Bloomin’ has struggled to grow sales in recent quarters. Its U.S. same-store sales fell 1.5% in the third quarter.
