TGI Friday’s has become the latest restaurant chain casualty, filing for Chapter 11 bankruptcy in Texas on November 2, according to a Bloomberg report.
The casual dining restaurant chain said it is facing challenges from changing consumer habits amid a cost-of-living crisis and increased competition from fast food options, the report added.
Earlier on October 31, Reuters reported that TGIF was “running out of funds to meet its debt obligations”. It cited an independent auditor’s statement on the restaurant in June 2024, as reported by the Wall Street Journal.
TGIF has not yet responded to queries, as per the reports.
Filing For Bankruptcy
TGI Friday’s filed for Chapter 11 Bankruptcy in Texas on November 2. The company’s petition listed assets between $100-550 million and liabilities worth $100-500 million, the Bloomberg report added.
Bloomberg had earlier reported that TGIF was “gauging options” for funding and financing its restaurants during Chapter 11 restructuring.
Long List of Chains in Doldrums
The report noted that TGIF joins a long list of restaurant chains that have recently approached courts seeking protection amid growing competition from “faster” competitors such as Chipotle.
Besides casual dining, low-cost diners are also feeling the impact as housing expenses and inflation continue to push customers towards eating at home, being choosy about outside dinners or altering preferences to save money, it added.
Others undertaking Chapter 11 proceedings include the Red Lobster Management, which won court approval in September 2024 to leave Chapter 11 under new ownership. The famous chain is hoping to reverse years of declining sales, costly leases and dropping its “money-losing Ultimate Endless Shrimp” promotion, the report said.
Besides these, in this year alone, Italian chain Bucca di Beppo, fish taco chain Rubio’s Coastal Grill, and Mexican restaurant chain Tijuana Flats have also filed bankruptcy.
(With inputs from Bloomberg, Agencies)
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