en.elcierredigital.com McDonald's already knows it: its enemy is closing many restaurants in the United States
The American fast-food giant celebrates the collapse of its rival in the USA
Red Robin, one of the most well-known burger chains in the United States, has announced the closure of several of its locations. This decision comes after a decline in customer traffic and a fiscal year with significant losses. The closures are part of a plan to try to save the company, but the question is: will it be enough to turn the situation around?
Economic problems and store closures
The chain, which was once a leader in the fast-food sector, now faces difficult times. In an attempt to adapt to market conditions, Red Robin plans to close up to 15 restaurants in 2025 alone, with a projection of up to 70 closures in the coming years. Red Robin suffered a loss of $77.5 million in 2024, an alarming figure considering that in 2023 alone, the losses were $21.2 million.
The decline in customer traffic is one of the main factors behind these losses. Competition, higher prices, and changes in consumer habits have directly affected the chain's sales. Additionally, the increase in operating costs has made Red Robin's operations less profitable.
Red Robin's restructuring plan
Red Robin has implemented the North Star turnaround plan: a restructuring strategy that aims to close between 10 and 15 restaurants each year as lease agreements expire. Although the company still hopes to save its operations, the future remains uncertain. The company's executives acknowledge that the 2024 results were much worse than expected.
Red Robin's CEO, GJ Hart, remained optimistic despite the negative results. He stated that the company has managed to improve the customer experience and that they still have a "great opportunity." However, the challenge is significant, as competition in the fast-food sector remains fierce.
Challenges in the fast-food industry
Red Robin's situation reflects a broader landscape within the restaurant industry in the United States. Fast-food chains, especially those that fail to quickly adapt to new trends, are facing serious economic problems. Inflation, rising costs, and changing consumer preferences are making competition increasingly tough.
Economic uncertainty has also affected sales. Consumers are more cautious with their spending, leading to a decline in demand for dining out. Companies must adapt to these changes to remain competitive and avoid the closure of more stores.
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