Whitey Ford
05-18-2024, 07:57 PM
Red Lobster offered customers all-you-can-eat shrimp. That was a mistake
https://imagizer.imageshack.com/v2/xq70/922/Acb8Nh.jpg (https://imageshack.com/i/pmAcb8Nhj)
The beloved yet beleaguered pillar of casual dining abruptly shuttered dozens of locations this week, heightening speculation that the chain is careening toward bankruptcy.
Although its dire financial situation isn’t the result of a single misstep, executives at the company that owns a large stake in the chain, as well as industry experts, said that miscalculations over the popularity of the all-you-can-eat shrimp special accelerated the company’s downward spiral.
In an effort to boost foot traffic and ease the sales slump that swept through the restaurant industry during the pandemic, Red Lobster executives last year decided to relaunch a popular marketing ploy from years past to lure customers: For $20 they could eat as much shrimp as they wanted.
Eager for a deal during an era of high inflation, many consumers eagerly embraced the offer as a challenge. People took to TikTok to brag about how many of the pink morsels they could put down in a sitting — one woman boasted she’d consumed 108 shrimp over the course of a 4-hour meal.
During a presentation about sales from the third quarter of last year, Ludovic Garnier, the chief financial officer of Thai Union Group, a seafood conglomerate that has been Red Lobster’s largest shareholder since 2020, cited the endless shrimp deal as a key reason the chain had an operating loss of about $11 million during that time frame.
https://www.latimes.com/business/story/2024-05-14/red-lobster-closings-all-you-can-eat-shrimp
https://imagizer.imageshack.com/v2/xq70/922/Acb8Nh.jpg (https://imageshack.com/i/pmAcb8Nhj)
The beloved yet beleaguered pillar of casual dining abruptly shuttered dozens of locations this week, heightening speculation that the chain is careening toward bankruptcy.
Although its dire financial situation isn’t the result of a single misstep, executives at the company that owns a large stake in the chain, as well as industry experts, said that miscalculations over the popularity of the all-you-can-eat shrimp special accelerated the company’s downward spiral.
In an effort to boost foot traffic and ease the sales slump that swept through the restaurant industry during the pandemic, Red Lobster executives last year decided to relaunch a popular marketing ploy from years past to lure customers: For $20 they could eat as much shrimp as they wanted.
Eager for a deal during an era of high inflation, many consumers eagerly embraced the offer as a challenge. People took to TikTok to brag about how many of the pink morsels they could put down in a sitting — one woman boasted she’d consumed 108 shrimp over the course of a 4-hour meal.
During a presentation about sales from the third quarter of last year, Ludovic Garnier, the chief financial officer of Thai Union Group, a seafood conglomerate that has been Red Lobster’s largest shareholder since 2020, cited the endless shrimp deal as a key reason the chain had an operating loss of about $11 million during that time frame.
https://www.latimes.com/business/story/2024-05-14/red-lobster-closings-all-you-can-eat-shrimp