This Beloved Burger Chain Could Be Shutting Their Doors For Good
There's no denying that restaurants are struggling after shutting down due to the coronavirus pandemic, and recently due to some strict curfews. Even chain restaurants are having a hard time, like T.G.I. Friday's closing over 70 locations around the country, as well as many other popular chains. And while the country starts to slowly brush off the dust and open up their doors, it seems another popular burger chain is struggling to keep up, and that's Red Robin.
According to a recent Securities and Exchange Commission filing, Red Robin had revealed a need to raise equity capital, but there's some doubt that the company will be able to meet their financial obligations by their set issuance date. They admit the financial difficulties are due to closing because of COVID-19. As of right now, Red Robin has temporarily closed 35 restaurants, according to Restaurant Business, and continues to operate limited takeout and delivery service in their 414 other operating locations.
While having a good chunk of Red Robin restaurants open for takeout seems promising, the sales numbers are looking pretty bleak. When comparing year-over-year sales during the week of May 24, Red Robin reported a sales decrease of 47.1%, which is about $30,751 per store. Even the 158 restaurants that were able to partially reopen their doors are still seeing a sales decline of 31.9% year-over-year.
How Red Robin is fighting to stay open
The numbers are down significantly, but Red Robin isn't going down without a good fight. They are trying a few new ways to increase business from their customers after a steep decrease in sales from March and April.
The first is their Total Guest Experience, a new hospitality service model that they plan on incorporating as Red Robin locations slowly start to open. While the announcement of this is promising, there hasn't been much information released about what this will look like at these restaurants around the country.
Red Robin is also one of the many chains that cut their menu at the moment, similar to how McDonald's has cut menu items during the pandemic, in order to properly reflect what employees could handle during this time.
The company also announced they stopped paying full rent for the company restaurant, as well as the chain's headquarters building.
While these changes are small, it may be helpful for the company to continue to stay operating. They plan on delaying the release of their final first-quarter sales report, so for now, you can support Red Robin by ordering your favorite burger tonight.