Red Lobster shutters 48 stores across 27 states amid uncertain future

On Monday, May 13, the founder and CEO of a liquidation firm announced he’s leading the closure efforts of 48 Red Lobster locations. The seafood chain will have the locations’ kitchen equipment and more auctioned off as questions linger about the company’s long-term future.

Some customers looking to get a bite were blindsided by the news in Mira Mesa, California.

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One employee was shocked to learn his job was cut after not getting word from corporate and instead finding out from a coworker.

“I’m getting calls after calls this morning and my boy Don called me and he’s like, ‘You should come in right now,'” Ramon Garcia said. “I’m like, ‘Why, I’m off today,’ and he’s like, ‘Man, you just need to come in because there’s a lot of stuff going on.'”

Corporate operations reportedly told the workers that they have three days to clean out the restaurant.

Meanwhile, the restaurants impacted span more than 20 states in total. The closings are a sign that Red Lobster could be in the red. The chain is reportedly considering filing for bankruptcy protection.

Once considered an innovator in affordable dining, the chain has declined in recent years. Restaurant analysts blame factors such as corporate mismanagement. For instance, putting endless shrimp on the menu instead of leaving it as a promotion, as it had been for the past 18 years. The menu addition reportedly cut into the company’s profits and hurt customer service.

The Thai Union Group PCL — which owns Red Lobster — blames the COVID-19 pandemic and rising food costs from inflation for some of its financial troubles.

Other factors cited by restaurant analysts include the emergence of fast-food casual chains, taking away some of Red Lobster’s customer base and the chain cycling through four CEOs since 2020.