According to a recent report, one of the state's most reputable Californian restaurant chains is teetering on the brink of bankruptcy due to management oversights.
One too many underestimated their customers' dining habits, and the seafood giant is now in financial chaos.
One remarkable stumble was that in an all-you-can-eat promotion of crab priced at $22.99, most of the crab had been eaten, but only a few had been paid for by the customers.
Former Chairman Joe R. Lee told analysts that "it wasn't the second helping on all-you-can-eat, but the third" to underline how deeply off they had gone:
"it wasn't the second helping on all-you-can-eat, but the third"
Continuing its penchant for promotional pratfalls under Thai Union Group stewardship, Red Lobster stumbled again, this time with the all-you-can-eat shrimp offer—priced far too low at $20 for it to be a profitable initiative in the first place. This price has corrected to $25 to stem the financial bleed.
With all these measures put in place to steer the company back to the tide of stability, among them hiring a turnaround specialist in Jonathan Tibus as CEO, the restaurant still finds itself in troubled waters.
The firm has openly communicated to the chain its intentions to sever ties, citing compounded pressures of 2020, persistent challenges in the industry, and costs going through the roof.
The future is grim for this iconic seafood chain in California: It is now being called a "zombie brand" by Darren Tristano, CEO of FoodserviceResults.
Considering the company weighs its options between a recovery plan, bankruptcy, or outright sale alongside a substantial $527 million write-off, this has no immediate buyers.
Bankruptcy, of all these possibilities, is the most realistic. And it's a topic with some people across California and beyond talking and opining as it unfolds.
Disclaimer: This article serves purely for educational and informational purposes and bears no affiliations with any businesses or organizations mentioned.