A Rough Year for Restaurants: 26 Chains File for Bankruptcy as Consumers Pull Back Spending
2024 was a challenging year for the restaurant industry, with 26 restaurant companies filing for Chapter 11 bankruptcy protection. This is nearly triple the number of filings in 2020, during the height of the pandemic.
The decline in restaurant spending led to weak sales and a surge in bankruptcies. Many casual-dining chains struggled to attract customers, adding to the segment’s challenges that have mounted since the Great Recession.
Some of the notable restaurant chains that announced closures in 2024 include:
* Wendy’s, which plans to shutter 140 underperforming locations
* Applebee’s, which closed between 25 and 35 locations
* Denny’s, which closed about 50 locations and plans to shut down an additional 100 restaurants by the end of 2025
* TGI Fridays, which shut down 86 restaurants before filing for bankruptcy
* Red Lobster, which permanently closed more than 120 restaurants
* Noodles & Co., which closed roughly 20 locations
* Bloomin’ Brands, which shuttered 41 underperforming restaurants
The challenges facing the restaurant industry are expected to continue, with consumers still seeking value and discounts when they do choose to dine out. The industry’s struggles are a result of the ongoing pandemic, inflation, and changing consumer behavior.