According to reports, Red Lobster is closing at least 48 of its locations, and a restaurant supply liquidator will auction off kitchen equipment from the affected restaurants this week.
TAGeX Brands announced on Monday that it will hold an online auction through Thursday, May 16, for certain Red Lobster restaurants closing across numerous states. Most significantly, California and Florida would lose five locations each, while Maryland and Colorado would lose four.
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Nexstar’s KETK also claimed that three Red Lobster restaurants in Texas abruptly closed last week, with their hours marked as “closed.” You couldn’t reach either of those sites by phone.
In Illinois, the mayor of Danville expressed concern on Facebook about the sudden closing of the city’s only Red Lobster and offered his prayers to the impacted employees.
Rickey Williams Jr., the mayor of Danville, wrote, “After 31 years of serving our community, without notice, their parent company laid off the entire crew and closed the restaurant effective immediately.”
He said, “This is despite the fact that they ranked number 15 out of over 600 stores for customer service and satisfaction last year.”
The auction has a variety of things, including high-performance ovens, upright refrigerators, and dining room furnishings. TageX Brands described it as “the largest restaurant equipment auction ever” on its website. Note that TAGeX Brands is not offering the items separately. Each location will have one winning bidder who will take all of the eatery’s contents.
“These auctions are WINNER TAKES ALL, meaning each winner will receive the entire contents of the Red Lobster location they bid on,” stated TageX Brands.
Bloomberg and CNBC reported in April that the seafood chain, which has been a cornerstone of the American restaurant scene for decades, was considering declaring bankruptcy. However, Red Lobster has not publicly acknowledged this. According to the report, people familiar with the situation stated that Red Lobster was seeking restructuring counsel to manage lease and labor issues.
The corporation has suffered financial and internal issues in recent years. According to CNN, the corporation hired a new CEO, CMO, CFO, and CIO between 2021 and 2022. Apparently, they all left within two years.
Then there was the never-ending shrimp disaster. In June 2023, the company placed its “Ultimate Endless Shrimp,”ย a limited-time special, on their regular menu for $20. The initiative to lure more people into the business was successful, but at a cost.
According to Restaurant Business, Red Lobster had an operating loss of more than $11 million in the third quarter of that year. The ongoing shrimp contract, according to parent business Thai Union Group, was a “key factor” in causing the loss.
Thai Union Group indicated earlier this year that it intended to sell its ownership in the business, citing the impact of a “combination of [the] COVID-19 pandemic, sustained industry headwinds, higher interest rates, and rising material and labor costs” on profitability.
Bill Darden founded Red Lobster, which first debuted in 1968 in Lakeland, Florida, advertising delicious fish for people from all walks of life. As of Monday, the website claimed that there were over 700 Red Lobster restaurants worldwide.
