TGI Fridays became the latest chain restaurant to declare bankruptcy on Saturday as 2024 is on pace to see the most bankruptcies in decades outside of 2020 when the COVID-19 pandemic hit.
The casual dining chain announced the bankruptcy in a statement on Saturday. While the business restructures, its restaurants will remain open, the statement said. The company owns 39 restaurants around the United States. The company’s 56 franchisees are independent and not included in the filing.
“The next steps announced today are difficult but necessary actions to protect the best interests of our stakeholders, including our domestic and international franchisees and our valued team members around the world,” TGI Fridays Inc. executive chairman Rohit Manocha said in a statement. “The primary driver of our financial challenges resulted from COVID-19 and our capital structure.”
Bloomberg reported in October that TGI Fridays was potentially looking at bankruptcy as it navigated financial troubles.
TGI Fridays announcement is the latest in a string of bankruptcies among casual dining chains, including some of the most recognizable brands such as the seafood restaurant Red Lobster and the Italian eatery Buca di Beppo. Hooters of America is under financial stress and is meeting with lenders and financial experts about its troubles.
This year is on track to see the most bankruptcies among restaurant chains in decades outside of 2020 as visits to casual dining eateries fall. Traffic to such restaurants declined 4.5% from 2023 to 2024 in the period from the start of the year to early October.
Red Lobster declared bankruptcy in May after it made permanent a $20 special for “unlimited endless shrimp,” which ultimately proved a massive money-loser for the company and contributed to its downfall. The company lost $11 million on the deal.
In June, Hooters said it was closing “a select” number of locations “under pressure from current market conditions.” The announcement followed a May reveal that Applebees would close dozens of its restaurants this year.
