The restaurant industry has had a tough year, leading many chains to close underperforming locations in 2024 as they try to boost sales in the coming years.
Inflation-weary consumers are spending less on restaurants in 2024, instead looking for great deals and discounts when choosing to dine out. Overall U.S. restaurant traffic declined in the first 10 months of this year, according to industry tracker Black Box Intelligence.
The decline in restaurant spending has led to weaker sales and a surge in bankruptcies in the industry. In 2024, 26 restaurant companies filed for Chapter 11 bankruptcy protection, nearly three times the number of filings during the height of the pandemic in 2020.
With few exceptions, casual-dining chains in particular have struggled to attract customers, exacerbating challenges the industry has faced since the Great Recession. Since the rise of fast-casual chains, many diners have turned to players that promise convenience and quality, such as Chipotle or sweet green surpassing the casual dining chains that have dominated the past few decades.
Here are the restaurant chains that have announced closures in 2024:
Wendy’s
The Wendy’s logo can be seen on the sign outside Muncy’s restaurant.
Paul Weaver | Light Rocket | Getty Images
late October, Wendy’s The company announced that it will close 140 underperforming stores by the end of this year, in addition to the approximately 80 stores it closed in the first three quarters.
Executives decided to prune some of the outdated restaurants, which had an annual turnover of about $1 million, to improve the company’s overall footprint.
Wendy’s CEO Kirk Tanner told investors on the company’s third-quarter earnings call that despite store closures, the company expects the number of restaurants to remain stable through the end of 2024 due to the opening of new restaurants. Change.
Applebee’s
A sign is posted in front of an Applebee’s restaurant on June 12, 2024 in Hayward, California.
Justin Sullivan | Getty Images
In May, Applebee’s parents, Catering brandsaid it planned to close 25 to 35 stores of the brand in the United States. As of late September, Applebee’s global store count had dropped by 36 locations compared with the same period last year.
Applebee’s same-store sales have declined for six consecutive quarters, according to company filings.
Dine Brands, which also owns IHOP, has closed more stores than opened every year since 2016 (except in 2022).
Danny’s
In an aerial view, customers enter a Denny’s restaurant on February 13, 2023 in Emeryville, California.
Justin Sullivan | Getty Images
Danny’s Approximately 50 restaurants will be closed in 2024, with plans to close another 100 restaurants by the end of 2025.
Executives said at the company’s investor day in October that the restaurants marked for closure were the chain’s third-worst performer, with annual revenue of $1.9 million to $2 million. Once these restaurants close, Denny’s expects its same-store sales and annual volume to improve. In the latest quarter, the chain’s same-store sales were roughly flat.
After 2025, Denny’s plans to open a net 45 to 50 new stores per year.
TGI Friday
The TGI Fridays logo appears at one of their locations.
John Rampalski | Light Rocket | Getty Images
In November, TGI Fridays joined a number of restaurant companies filing for bankruptcy protection. But before filing for Chapter 11, the company closed 86 restaurants, starting with 36 in January and closing 50 more by the end of October.
The last round of closures reduced the chain’s locations to about 160 locations worldwide. But the numbers are likely to decrease even more. A bankruptcy court in Texas will decide the future of TGI Fridays, which could mean the chain’s closure.
red lobster
The exterior of a Red Lobster restaurant in Austin, Texas, on May 20, 2024. Red Lobster has filed for Chapter 11 bankruptcy protection after a leaseback agreement failed and an “Endless Shrimp” promotion backfired on the company’s revenue.
Brandon Bell | Getty Images
Red Lobster will permanently close more than 120 restaurants in 2024.
The seafood chain closed about 100 stores before filing for Chapter 11 bankruptcy protection in May. The company turned down leases for 23 more restaurants before getting a new owner and CEO.
But as 2024 passes, Red Lobster hopes to make a comeback in the future and never close its doors again.
noodle company
Michael Siluk | Underground CG | Universal Image Group | Getty Images
fast casual chain noodle company In August, after reviewing the full size of its 475 restaurants, the company announced it would close about 20 restaurants.
The review is part of the company’s efforts to improve its operations and financial health after several tumultuous years. Noodles & Co. has also overhauled its menu, cutting out items that aren’t popular and adding new entrees that might attract more customers.
But turning things around will take time. The company said same-store sales fell 3.3% in the latest quarter.
bloom
Customers arrive at Outback Steakhouse on November 2, 2021 in Skokie, Illinois.
Scott Olson | Getty Images
blooming brandThe parent company of Outback Steakhouse, Carrabba’s Italian Grill and Bonefish Grill closed 41 underperforming restaurants in 2024.
Executives said on the company’s earnings call in February that the closure affects older stores with leases dating back to the 1990s and early 2000s. To make its decision, the company weighed sales and footfall at the locations, as well as the cost of investing in improving the locations. Most of the closures are inland areas.
Like many other casual dining companies, Bloomin’ has struggled to grow sales in recent quarters. Its U.S. same-store sales fell 1.5% in the third quarter.
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