Endless shrimp, all you can eat crabfests, and soft, Cheddar Bay biscuits may be going the way of the dinosaurs, as seafood chain Red Lobster may shutter due to weak demand and decreasing margins. Red Lobster is the current biggest full service seafood specialty chain.
In 2013, Red Lobster concludes the year with a measly 10 percent gain, as shares tumbled to 6 percent on Thursday, Dec. 19. Darden Restaurants, which owns Red Lobster, unveiled plans to spin off or sell the chain as quarterly profits dropped 42 percent, worse than expected. In an effort to increase cost savings and reduce unit growth, Red Lobster could close its 705 restaurant locations in the U.S. and Canada by 2015.
The cut back will also affect Olive Garden and Longhorn Steakhouse. As a result of an unstable economy and more conservative spending habits by consumers, Olive Garden and Longhorn will halt the openings of any new locations. The shift to less time-consuming and cheaper eateries, such as Chipotle, has contributed to a decrease in fine dining — if you can call Red Lobster that.
Although Darden hasn’t made a final decision on the future of the chain, a Red Lobster spinoff could adopt the dining strategies at Olive Garden and Longhorn Steakhouse. Possibly buffet style, lobster bowls, a more faster alternative?