Red Lobster has had a fishy few months. In May, the seafood chain filed for bankruptcy after more than 50 locations closed amid massive losses from its mayhem-making Endless Shrimp promotion.
But in August, Red Lobster reeled in a new CEO: Damola Adamolekun, the 35-year-old former P.F. Chang’s chief executive. Adamolekun is on a mission to revive the embroiled 56-year-old restaurant chain after it was rocked by crustacean chaos in the past couple of years.
“This is, without exaggeration, one of the most important companies in American history,” Adamolekun told CNN. “There were certainly big mistakes made over the last few years.”
One of the major missteps Adamolekun is referring to was Red Lobster’s endless shrimp promotion. It was wildly popular with guests, but it was entirely too costly for the restaurant chain—which suffered millions in operating losses—and put undue stress on servers and kitchen staff, Adamolekun said.
Shrimp is a “very expensive product to give away endlessly,” he said in the CNN interview. “When you have endless shrimp, and people are coming in and sitting down at the table and eating for hours as much shrimp as they possibly can, you stress out the kitchen. You stress out the servers. You stress out the host. People can’t get a table. It creates a lot of chaos.”
The “Ultimate Endless Shrimp” deal launched in June 2023, and diners could choose from two types of unlimited shrimp dishes for $20. The deal, which halted in late 2023, also included the chain’s famous Cheddar Bay Biscuits. It had previously been a limited-time deal, but the restaurant’s attempt to make it a standing menu option ultimately factored into the company’s downfall. It resulted in an $11 million loss, and its restructuring team blamed it as a direct contributor to its May bankruptcy filing.
“We wanted to boost our traffic, and it didn’t work,” Thai Union Group chief financial officer Ludovic Regis Henri Garnier told investors. “We need to be much more careful regarding what are the entry points and what is the price point we are offering for this promotion.” Thai Union Group is Red Lobster’s Thailand-based investor and it expects to fully divest by the end of the year.
Thiraphong Chansiri, Thai Union Group’s CEO, however, pointed to other factors beleaguering the seafood chain.
“The combination of COVID-19 pandemic, sustained industry headwinds, higher interest rates and rising…
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