8 Restaurant Chains That Are Currently Shrinking
COVID-19 isn't done with the restaurant industry yet. Two years into the pandemic, many U.S. restaurant chains are continuing to struggle, faced with declining sales on one hand and rapidly changing consumer behaviors on the other. Chains that have avoided bankruptcy thus far have done so at considerable expense, shedding dozens of restaurants—and in some cases, hundreds—in order to stay afloat.
Legacy brands of the '80s and '90s have been particularly hard hit in the past few years, with once massive chains like Ruby Tuesday and Boston Market sustaining considerable losses and shrinking in size to a few hundred locations each. Meanwhile, buffet-style restaurants like Ponderosa and Golden Corral have had their moment of reckoning, prompted by the pandemic to reconsider a business model that may no longer be tenable.
Here are eight American restaurant chains that are currently shrinking.
For more fast-food news, check out 8 Worst Fast-Food Burgers to Stay Away From Right Now.
Ruby Tuesday made it through the pandemic, but just barely. Like many other fast-casual chains now decades past their prime, Ruby Tuesday was pushed into bankruptcy, filing for Chapter 11 protection in late 2020. Debt protection was awarded in February of 2021, but the chain emerged from bankruptcy court a ghost of its former self, with its restaurant count cut by more than half—from 451 to 209.
Boston Market has been in the news recently, following last year's announcement of ambitious expansion plans and the debut of a new, takeout-friendly restaurant design. But the regional favorite has been in a nose-dive for the past two decades, following a Chapter 11 bankruptcy filing in 1998.
Since then, Boston Market has passed through the hands of no fewer than three different parent companies, and has watched its restaurant count steadily decline, from a high of 1,200 units in 1998, to an all-time low of 326 last year.
As recently as 2018, when many other buffet chains were showing signs of decline, Golden Corral was still cracking the top 100 of Restaurant Business's annual "Top 500" list, reporting a restaurant count of 489.
But even America's #1 buffet restaurant couldn't beat the pandemic. Since 2018, Golden Corral's footprint has shrunk by over 25%, with most of the losses occurring in the past two years. Last month, the buffet chain reported a system-wide total of 360 restaurants, with 80 restaurants lost in pandemic-related closures.
Despite its significantly reduced footprint, Golden Corral is still plotting a comeback, with plans for a new line of restaurants with a simplified and—wait for it—takeout-friendly store design.
Ponderosa Steakhouse and Bonanza Steakhouse
Beloved steakhouses Ponderosa and Bonanza (whose names were inspired by the '60s Western show, Bonanza) were acquired by FAT Brands in 2017, following several decades of ownership by conglomerate Metromedia Restaurant Group and a bankruptcy filing in 2008.
While the sister brands have found a sanctuary of sorts in FAT Brands, they show no signs of recovering from their years-long decline. Their current collective restaurant count totals just 23 locations, down from 75 in 2019.
Steak 'n Shake
Founded in 1934, Steak 'n Shake is another decades-old fast-food brand with an uncertain future. Handed off from one parent company to another, Steak 'n Shake experienced something of a resurgence in the late 2000s, under the leadership of entrepreneur Sardar Biglari. Unfortunately, however, that momentum was short-lived, beginning to peter out by 2016.
In the years since, the company has routinely made headlines with its erratic finances, announcing a fire sale of hundreds of its restaurants in 2018, and narrowly avoiding bankruptcy in early 2021. All the while, its store count has been steadily decreasing, from as many as 423 restaurants in 2008 to just 306 in 2020.
One of the biggest stories in declining quick service chains, Quiznos' store count has shrunk by an incredible 94% in the past 15 years. The sandwich chain peaked in size in 2006, with 5,000 units to its name. In the time since, it's footprint has (roughly) halved every five years: it was down to 2,800 units in 2010, 671 units in 2016, and 255 last year.
The sandwich brand is hoping to find renewed sales through a partnership with ghost kitchen company Ghost Kitchen Brands, which in 2021 announced plans to bring Quiznos into 100 of its stores, across the U.S. and Canada.
Despite the liquidation of its parent company Luby's in 2020, beloved burger chain Fuddruckers is still hobbling along, acquired for $18.5 million by Black Titan Franchise Systems in late 2021. But Black Titan will have its work cut out in attempting to rehabilitate Fuddruckers.
The brand has been in a steady decline since at least 2010, when it was acquired by Luby's. It's store count has shrunk by about half in the past decade, from 198 stores in 2010 to just 92 last year.
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