TGI Fridays Just Announced Sad News For Fans
Some parts of the country may be getting ready to reopen, but it won't be business as usual for casual dining restaurant TGI Fridays, whose CEO admits the chain may close as much as 20 percent of its restaurants (or about 70 outlets) permanently as a result of the coronavirus. The chain known for its endless apps and embracing the mantra "In Here, It's Always Friday" is definitely in trouble. "Some will close forever, without a doubt," Fridays CEO Ray Blanchette told Bloomberg during an interview. "Right now it's all triage and it's all about cash: How are you going to make it through and keep the company solvent?"
When the pandemic hit, Blanchette told Bloomberg that the restaurant's sales had dropped by about 80 percent almost immediately. Thanks to pickup and delivery, Fridays was able to make a modest comeback, but the restaurant chain's sales are still off by about 50 percent.
TGI Fridays is trying some new tactics to stay open
Still, Fridays is not giving up without a fight. While curbside pickup has been offered as the restaurant temporarily shuttered its dining rooms, stores in some markets are starting to reopen. Select locations are currently experimenting with outdoor seating by renting white party tents, so its guests can sit in the parking lot, enjoy a meal, and practice social distancing all at the same time — but only time can tell if this gamble will pay off.
"We”ll run it for a month and we'll see how it goes, and if we can do that profitably we'll do it," Blanchette said. "We have become very entrepreneurial. No one's got a playbook here."
TGI Fridays had been struggling before the pandemic struck
As with other restaurants and retail outlets which have been forced to shutter stores or declare bankruptcy because of the coronavirus, TGI Fridays had already been struggling before the shelter-in-place orders were announced. In February, a month before COVID-19 brought America to a standstill, Fridays and its franchisees announced it had closed 34 restaurants in 2019. According to National Restaurant News, Fridays' overall sales were down 11.3 percent, and traffic into the restaurant dropped 9.1 percent last year (via Today).
TGI Fridays isn't the only restaurant chain that is being punished by the shutdowns arising from the pandemic. Steak 'n Shake is closing outlets too, while chains like Sweet Tomatoes and Souplantation have called it a day and will not reopen. Unfortunately, these closures won't be the last. Bloomberg reports that restaurant booking service OpenTable predicts a quarter of America's restaurants won't survive the pandemic. Business intelligence firm S&P Market Intelligence has even named the restaurant companies with the highest one-year probability of default, as a result of the pandemic — and we're not liking what we see.