TGI Fridays Closes More Restaurants With Bankruptcy On The Horizon

The future is looking bleak for TGI Fridays, which unexpectedly closed 50 of its restaurant locations over the past week. These closures are in addition to the 36 that occurred earlier this year, and this comes after Bloomberg reported the brand is working with lenders in preparation for Chapter 11 bankruptcy.

Local media reported TGI Fridays restaurants in California, Ohio, New York, New Jersey, Florida and Missouri were affected by this most recent wave of closures. Per the company's store locator, its total number of locations currently sits at 164.

Industry experts expect TGI Fridays to file for bankruptcy in November as a result of its dwindling footprint, "changing customer preferences," and competition with fast food pricing. In addition to its choice burger offerings, the restaurant chain has also branched out to the grocery aisle in the past lending its branding to many snack foods and frozen appetizers. Unfortunately, these ventures have not been enough to stave off the recent closures.

TGI Fridays is not alone in its financial struggles and rapidly diminishing footprint. Denny's, the breakfast diner chain, announced in a recent earnings call that it expects to close 150 locations over the next year. Back in April, Red Lobster also filed for bankruptcy in an attempt to restructure and keep the company afloat. During these mass chain closures, we've also witnessed the near total obliteration of the Boston Market, which is down to just 27 locations. Boston Market lost a $12 million lawsuit in February, but also severely lowered its standards for franchising as one of its attempts at a comeback.

These types of restaurants mainly serve middle class markets, and for this group, eating out is often the first line item to be sacrificed as pocketbooks tighten. TGI Fridays may be in the early stages of decline, but the economic climate has led to a drawback, following years of consistent expansion.