Restaurant Industry Insights

Restaurants Permanently Shutting Their Doors

From scaling back their footprint to closing the doors for good, it’s always sad to see one of our family members deciding it’s time to readjust and possibly leave the industry for good. Many people, particularly those not engulfed in daily operations, believe restaurants close for one of a few reasons: bad location, bad quality, or bad service. 

There is, however, much more behind the scenes than the basic considerations. Staffing problems, supply chain issues, and increasing costs can all play a part. Changing consumer preferences, which no longer transform over decades, but days, thanks to social media, certainly have their hand in the mix.

Let’s explore some of the well-known restaurants that recently decided to bow out.

Caffe Roma

For 45 years, Caffe Roma laid claim as one of the iconic restaurants in Beverly Hills. Known for homemade pasta and delicious Italian food, it was, needless to say, quite a shock when they announced their doors would be closing on January 1, 2024. 

They are, however, still offering takeaway orders through their sister restaurant, Café Amici. While many thought the closure had something to do with the long and costly writer’s and actor’s strikes, it came down to rent. Their landlord doubled it, making it challenging to continue.  

Spartina LA

There is a restaurant that blamed its closure on the writer’s and actor’s s strikes. Spartina LA, a landmark on Melrose Avenue in Los Angeles for about nine years, told Eater that sales dropped about 40 percent since Memorial Day. Chef Stephen Kalt, with a long-time career in restaurants across the country, was at the helm. 

Buffalo Wild Wings

Buffalo Wild Wings, a brand uniquely positioned as the largest sports bar venue, closed all of its Canada locations in 2023, amounting to about 1,200 sites. In March, the beleaguered chain faced a class action lawsuit by a customer claiming they had falsely represented their boneless chicken wings as real chicken wings. 

Their response via social media was priceless: 

“It’s true. Our boneless wings are all white meat chicken. Our hamburgers contain no ham. Our buffalo wings are 0% buffalo.” 

White Castle

The world’s first burger chain, opening in 1921, seems to be in some trouble. While some prominent locations are closing their doors, the real thorn in their side is a lawsuit. A class-action lawsuit filed by employees regarding the misuse of their biometric fingerprints could result in a $17 billion payout in penalties. 

Hagerstown Closures

This city in Maryland, which serves as a gateway to Washington, DC, and Baltimore, is the hub for commerce and government in the tri-state area. Despite its location and reputation, two restaurant chains closed one after the other. According to DC News Now, Golden Corral was the first to go, leaving behind an abandoned building, followed by KFC.

In-N-Out

Don’t panic. This well-known brand is only closing one restaurant. However, it’s the first permanent closure in their 75 years in business—quite a track record. The location is in Oakland, CA, and it’s not closing due to financial hardship. It’s closing due to crime. While a profitable location, customers and employees experience regular car break-ins, theft, and even armed robberies.

Noma

This Copenhagen restaurant, which has made it on the list of the “World’s Best Restaurants” numerous times, is shutting down after two decades in business. Chef René Redzepi, praised as one of the most influential chefs, told the New York Times he will be closing at winter’s end in 2024. At that time, it will become a food laboratory, developing new products for Noma Projects, an e-commerce operation. 

According to Redzepi, maintaining their high standards required almost 100 employees to work grueling hours. The market would not bear the prices they needed to charge to pay their employees fairly. In 2021, Noma received three Michelin stars for the first time. Today, he believes the modern fine-dining model is unsustainable.

According to the National Restaurant Association, the restaurant industry has an estimated 30% failure rate. Are you interested in businesses with the lowest failure rates? Self-storage, vending machines, and laundromat businesses all fall in the low failure rate category. They don’t, however, sound quite as exciting.

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