10 Facts About Red Lobster's Bankruptcy You Won't Believe
Red Lobster was founded in 1968 in Lakeland, Florida, and quickly became a beloved staple in American dining culture.
By the 1980s and 1990s, Red Lobster had expanded rapidly, becoming a popular spot for family celebrations and special occasions.
One of Red Lobster's most iconic offerings, Cheddar Bay Biscuits, was introduced in the early 1990s and has since become a fan favorite.
To finance the purchase, Golden Gate Capital sold Red Lobster’s real estate, forcing the chain to pay rent on its properties, contributing to financial strain.
The COVID-19 pandemic hit Red Lobster hard, with massive financial losses due to reduced foot traffic and increased operating costs.
Red Lobster has seen a high turnover of executives, including operating for a year without a CEO, which destabilized its leadership.
The introduction of Ultimate Endless Shrimp at $20 was meant to attract customers but instead resulted in significant losses, with diners consuming large quantities of shrimp without ordering other items.
Thai Union pushed out two rival suppliers of breaded shrimp to secure a costlier exclusive deal, further impacting Red Lobster's financial health.
In its bankruptcy filing, Red Lobster requested to reject 108 leases to abandon unprofitable locations, aiming to reduce overhead costs.
Recently, dozens of Red Lobster locations were closed abruptly, with their contents auctioned off, signaling the severity of the financial crisis.