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[kapshin]

Promotion causes $11 million dollar loss..... hey genius did you ever think after it starting losing even at $1 million stop the damn promotion?

 

[StreetsofBeige]

Promotion causes $11 million dollar loss..... hey genius did you ever think after it starting losing even at $1 million stop the damn promotion?

Guy in charge no idea what he's doing.

In the articles about this debacle, he even streamlined food wholesalers to one company for some products. Not surprisingly, they got charged high prices and ran out of shrimp sometimes.

A multi-vendor strategy would had improved both costs and inventory capacity.

Somehow even mom and pop restaurant owners know to shop different wholesalers for ingredients and supplies.

 

[BadBurger]

It turns out that their main issue was corporate raiding:

David Dayen (@ddayen.bsky.social)

Did Red Lobster go down because of its Endless Shrimp deal? @lukewgoldstein runs the numbers. Losses from Endless Shrimp: $11 million Sale-leaseback deal that put Red Lobster properties on the hook for rent payments: $1.5 *billion* https://prospect.org/economy/2024-05-22-raiding-red-lobster/

bsky.app

"Golden Gate crippled Red Lobster by selling off one of its most valuable assets, the real estate it owned, in what's known as a sale-leaseback, for $1.5 billion. With that sale, Golden Gate nearly made back its $2.1 billion purchase of Red Lobster, while turning the chain into a permanent leaser"

 

[Deleted member 1159]

BUFFALO WILD WINGS HAS UNLIMITED WINGS AND FRIES MONDAYS AND WEDNESDAYS, I ALREADY GOT A LUNCH APPOINTMENT WITH SOME COWORKERS LFG

 

[AJUMP23]

this is the McDonald's model. Corporate rents the land to the franchisees.

 

[Unknown Soldier]

It turns out that their main issue was corporate raiding:

David Dayen (@ddayen.bsky.social)

Did Red Lobster go down because of its Endless Shrimp deal? @lukewgoldstein runs the numbers. Losses from Endless Shrimp: $11 million Sale-leaseback deal that put Red Lobster properties on the hook for rent payments: $1.5 *billion* https://prospect.org/economy/2024-05-22-raiding-red-lobster/

bsky.app

It's a standard procedure for gutting American retail too. That's how Toys'R'Us died

 

[Darkmakaimura]

The lobster itself was nothing special but the coconut shrimp and fried clam were good. I used to work there for a couple years.

Don't forget the Chesapeake Bay biscuits.

 

[AJUMP23]

It turns out that their main issue was corporate raiding:

David Dayen (@ddayen.bsky.social)

Did Red Lobster go down because of its Endless Shrimp deal? @lukewgoldstein runs the numbers. Losses from Endless Shrimp: $11 million Sale-leaseback deal that put Red Lobster properties on the hook for rent payments: $1.5 *billion* https://prospect.org/economy/2024-05-22-raiding-red-lobster/

bsky.app

This is pretty awful way to do business. I think the lease position can work but you cannot charge so much the asset cannot meet the obligation. You lose all lease money if the company doesn't exist.

 

[jufonuk]

Never been not American. But when I would go to visit family. We would go other seafood places.

Always wanted to try. That and sizzler. (Thanks to white men can't jump).

But I've been chilli's and applebees


But again real people working at those places so job loses and all that. Sorry to the people affected.

 

[BadBurger]

It's a standard procedure for gutting American retail too. That's how Toys'R'Us died

I thought the vulture capitalists used some (edit: other) weird way to leverage a bunch of debt on Toys 'R Us, but this kind of thing has happened so often I could be thinking of another company.

 

[drganon]

Hopefully red lobster doesn't completely go away. That and screw corporate raiders.

 

[AJUMP23]

Are they doing the same thing to Olive Garden because they were started by the same group.

 

[StreetsofBeige]

this is the McDonald's model. Corporate rents the land to the franchisees.

RL was stupid for selling. I understand the premise which is selling for big lump sums for cashflow, but if the new landlord is going to jack up the rent big time, it's a long run loser strategy.

It's be like a homeowner selling their house and renting it back off the new owners at bad rent prices.

 

[dave_d]

Anybody from New England is what happened to RL the same as Brigham's? I mean they were a local icon but got in financial trouble. Didn't they get bought up by a some venture capitalist firm? Didn't they just get gutted over like 4 years?

 

[calistan]

Bankrupt Red Lobster Runs All-You-Can-Grab Copper Wiring Promotion

ORLANDO, FL—Calling the campaign a once-in-a-lifetime opportunity that would leave customers satisfied and “go easy on their wallets,” bankrupt restaurant chain Red Lobster launched a $19.99 all-you-can-grab copper wiring promotion Monday at all of its locations. “Today, we’re rolling out an...

www.theonion.com

 

[Meicyn]

RL was stupid for selling. I understand the premise which is selling for big lump sums for cashflow, but if the new landlord is going to jack up the rent big time, it's a long run loser strategy.

It's be like a homeowner selling their house and renting it back off the new owners at bad rent prices.

Red Lobster was purchased by General Mills in the 1970s from an independent owner who started the business in 1968. It was then sold off to private equity when the restaurant chain started underperforming after the housing crash in 2008. Red Lobster hasn't been an independent company able to make its own decisions for half a century.

 

[IntentionalPun]

Butter and salt industries in shambles. If Olive Garden also falls they are in real trouble.

 

[Uhtred]

Red lobsters Ultimate Feast is the greatest dish ever served. I truly hope they can find their way out of this. I will be crushed if they go away.

 

[StreetsofBeige]

The $20 US charged for unlimited shrimp dinners seems cheap too. Its seafood too. They probably should had jacked it up $5-10.

 

[jason10mm]

RL was stupid for selling. I understand the premise which is selling for big lump sums for cashflow, but if the new landlord is going to jack up the rent big time, it's a long run loser strategy.

It's be like a homeowner selling their house and renting it back off the new owners at bad rent prices.

Soooo, like a reverse mortgage?

 

[ÆMNE22A!C]

Never had lobster.

In my mouth

 

[Cohetedor]

Soooo, like a reverse mortgage?

Exactly, and like a reverse mortgage, the debt is settled once your dead(or in RL's case, bankrupt)

 

[StreetsofBeige]

Soooo, like a reverse mortgage?

I think that's different, but kind of the same.

From what I read, RL totally sold off the real estate (I think), but leased it back at crap rates. A reverse mortgage has the person still owning the property, but borrows against it at a crap rate. And when the person sells the property they get nailed for the interest rate fees after they sell.

 

[Raven117]

Soooo, like a reverse mortgage?

Sort of.

Sell property.
Get fresh capital to turn things around.
Pay rent (which under good terms can be beneficial).
Turn company around with the new capital.

But, under an already existing Leverage Buy Out...I mean...writing was on the wall.

 

[Woggleman]

Not the biggest fan of them since I live near the ocean and can get much better seafood but their biscuits were top notch. I could go there and just eat them.

 

[EverydayBeast]

Unlimited anything works out in theory, it's a tool used by restaurants to get you to buy more drinks, deserts etc.

 

[AJUMP23]

The $20 US charged for unlimited shrimp dinners seems cheap too. Its seafood too. They probably should had jacked it up $5-10.

shrimp is farmed. I would doubt there would be wild caught shrimp at all At a chain restaurant.

 

[MaestroMike]

went one time a couple years ago got a steak and tail it was alright i know fedor Emilianenko is sad he crushed red lobster during his fight weeks haha

Pic: Fedor eats lot of Red Lobster, looks extra tan at weigh-ins

In world full of Fedor factoids and tall tales, this may be our new favorite. On Saturday in Long Island, New York, our Russian GOAT will fight once again

middleeasy.com

 

[nush]

This is a great video although rather dry on what was really going on behind the scenes.



I'm sure StreetsofBeige could pick out more "what the fucking fuck did nobody see what was actually going on?" than I have.

 

[Woggleman]

This reminds me of the time that I on a dare ate twenty dishes of pasta at the Olive Garden never ending pasta dish.

 

[dave_d]

This is a great video although rather dry on what was really going on behind the scenes.



I'm sure StreetsofBeige could pick out more "what the fucking fuck did nobody see what was actually going on?" than I have.

Wait, is that Patrick Boyle? I thought his coverage of Sam Bankman Fried was pretty funny. (Note, just checked. Yes it's Patrick Boyle. He has a pretty dry British sort of humor.)

 

[StreetsofBeige]

Unlimited anything works out in theory, it's a tool used by restaurants to get you to buy more drinks, deserts etc.

True.

And with seafood (especially unlimited) you'd think people would binge it ordering drinks to satisfy their thirst from breaded, salty and garlicky food.

But who knows. Maybe most of their clientele arent big on drinks, but instead load up on bottomless pop or free glasses of water.

 

[ReBurn]

True.

And with seafood (especially unlimited) you'd think people would binge it ordering drinks to satisfy their thirst from breaded, salty and garlicky food.

But who knows. Maybe most of their clientele arent big on drinks, but instead load up on bottomless pop or free glasses of water.

Non alcoholic drinks have free refills, so they aren't making it up on that.

 

[Quasicat]

I went to Red Lobster today to see how they are doing their shrimp…it's $20 for three entrees and you can add as many as you want for $5 each. Then the menu says Mondays are Endless Shrimp specials…perhaps they don't get a lot of people on Mondays and can justify it.