Red Lobster, the restaurant chain best known for cheddar bay biscuits and a magical ability to make seafood feel incredibly affordable, is laying off a significant number of employees as part of its ongoing restructuring efforts, according to filings made public this week. After generously misjudging the American appetite during a never-ending shrimp promotion that ended up costing the company millions, it seems the crustacean finally came home to roost. Or boil, rather.
The beloved but beleaguered seafood chain filed for Chapter 11 bankruptcy last month, citing rising food costs, declining customer traffic and what can only be described as an ambitious yet ultimately unsustainable commitment to letting people eat shrimp until they physically merged with the ocean. The Orlando-based company has, since the bankruptcy, closed dozens of underperforming restaurants and now finds itself tightening the apron strings with layoffs at its headquarters and beyond. Red Lobster did not disclose the number of jobs cut, though filings suggest the layoffs affected corporate staff more than restaurant workers, who continue to wield lobster crackers with stoic resolve.
Just last year, Red Lobster’s parent company, Thai Union Group, said the unlimited shrimp promotion had been a “core reason” for operating losses that quickly ballooned faster than a microwaved scallop. The deal, which let diners devour shrimp nonstop for $20, proved so popular that it became its own disaster, kind of like letting people fill up their bathtubs with cocktail sauce on the house. Executives had originally hoped the promotion would draw in more traffic and revenue, which it certainly did, although perhaps not in a way that any MBA spreadsheet enthusiast could reasonably endorse.
While filing for Chapter 11 gives Red Lobster a chance to restructure its debt and hopefully claw its way back to solvency, analysts say the future of the chain will depend on balancing affordability with a healthy fear of consumer appetites and the unpredictable price of frozen crustaceans. For now, the layoffs are being positioned as part of the company’s fresh start, a phrase that carries shades of optimism with just a spritz of Old Bay seasoning.
“We are continuing to take proactive steps to drive operational efficiency and best position Red Lobster for long-term success,” the company said in a statement, apparently with a straight face and a shrimp tail still dangling from the corner of its mouth.
It seems even the endless shrimp had an end, though unfortunately, it appears to have arrived at the HR department first.