Red Lobster, one of the largest seafood restaurant chains in the world, has declared bankruptcy. The company says it has more than $1 billion in debt and less than $30 million in cash. The company’s plans include selling the business to creditors and raising financing to maintain stability. Red Lobster also plans to close additional restaurants.
The famous Red Lobster, which offered shrimp, lobster, cheddar biscuits and other seafood dishes, spread across the country in the 1980s and 1990s. Sales peaked after being mentioned in Beyoncรฉ’s song “Formation” in 2016.
With 578 restaurants in 44 states and Canada, Red Lobster serves 64 million customers annually and generates $2 billion in annual sales. One in five of all lobster purchased in North America comes from Red Lobster. Despite its successful past, recent factors such as lack of management, competition, inflation and others have led to Red Lobster’s decline. Experts and former employees note a lack of investment in marketing, product quality, service and restaurant renovations.
