Hooters Unexpectedly Closes 40 Outlets Amid Growing Restaurant Industry Crisis

By: Georgia | Published: Jun 25, 2024

In a surprising move, Hooters has closed 40 of its restaurants as the industry battles increased costs for rent and food. 

These closures place Hooters alongside other chains like Red Lobster, struggling to keep up with escalating economic challenges.

A Swift and Sweeping Decision

Recently, Hooters made the decision to close multiple locations across states such as Florida, Kentucky, Rhode Island, Texas, and Virginia. 

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Nighttime view of a Hooters restaurant with bright orange and red neon signs and the Hooters owl logo illuminated above the entrance

Source: Wikimedia Commons

These closures happened mostly over a single weekend, significantly shrinking Hooters’ presence and pointing to unstable conditions in the dining sector.

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Not Sinking Like Others

Despite the drastic closures, Hooters isn’t facing the grim depths of bankruptcy like Red Lobster. 

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Daytime view of a Red Lobster restaurant showing the exterior with a red facade, logo of a lobster, and American and state flags flying above

Source: Wikimedia Commons

The company maintains that their 41-year-old brand “remains highly resilient and relevant,” aiming to reassure patrons and investors alike.

Frozen Wings to the Rescue?

In a pivot from dine-in to your freezer, Hooters is diving into the frozen food market. 

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Interior of a Hooters restaurant with patrons seated around tables eating wings, a server in Hooters uniform approaching with a tray, and large beers visible

Source: Hooters/Facebook

They’ve launched a range of Hooters-style frozen delicacies available in supermarkets across the nation, hoping to capture the taste of their menu at home.

Strategic Closures Amidst Economic Strain

A company spokesperson shared that these closures were a strategic choice in response to “current market conditions,” targeting underperforming locations. 

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Exterior view of a Hooters restaurant during the day, showing its distinctive orange and brick façade with the large Hooters logo on the building

Source: Wikimedia Commons

It’s a calculated effort by Hooters to streamline operations and stabilize financially.

A Promise to Keep Serving

Despite fewer restaurant locations, Hooters is committed to remaining accessible to its customers, aiming to serve them “at home, on the go and at our restaurants here in the US and around the globe.” 

Inside view of a Hooters restaurant showing a variety of seating arrangements, the bar area

Source: Wikimedia Commons

This reflects their ongoing dedication to their customer base.

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Shrinking Global Footprint

Post-closure, Hooters will operate around 300 global outlets, down from 333 in 2018.

Evening view of the Hooters Casino Hotel in Las Vegas, featuring a large sign with neon lights and the iconic owl logo

Source: Wikimedia Commons

The shrinkage reflects broader industry trends where even major players are having to reconsider their scale of operations.

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Competitors Still Expanding

While Hooters retracts, competitors like Dave & Buster’s, Miller’s Ale House, and Twin Peaks are managing to hold their ground or even expand

Close-up of the illuminated neon sign of Dave & Buster's, displaying the brand logo and the words "EAT DRINK" in bold letters against a dark night sky

Source: Wikimedia Commons

This showcases the varied impacts of the economic environment on different entities within the restaurant world.

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The Price Hike Backlash

In an effort to manage rising costs, Hooters, among others, has increased menu prices.

Interior of a bustling Hooters restaurant, featuring patrons dining and watching sports on screens

Source: Wikimedia Commons

Unfortunately, this has led to fewer customers walking through the doors, as diners balk at the higher costs.

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Industry-Wide Retraction

The landscape of dining is changing, with widespread closures affecting not just Hooters but also major chains like Applebee’s, TGI Fridays, and Boston Market, as well as smaller brands like BurgerFi.

Night view of an Applebee's restaurant with its modern facade brightly lit, featuring large windows and the distinctive red and blue neon stripes along the building

Source: Wikimedia Commons

These closures highlight the ongoing struggles within the restaurant industry.

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Wage Increases Trigger Closures

Significant impacts have been felt in California, where the minimum wage for fast food workers was raised to $20 an hour. 

Front view of Rubio's Coastal Grill, showcasing its beach-themed decor with a sign for "World Famous Fish Tacos" and the restaurant's branding visible above the entrance

Source: Wikimedia Commons

This hike has led some restaurants, including Rubio’s, to shut down many locations, struggling under the weight of increased labor costs.

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Hooters' Mixed Year of Milestones and Setbacks

Despite these challenges, Hooters marked its 40th anniversary in 2023 with optimism, opening new locations in Las Vegas and Florida. 

Sunny day view of a Hooters restaurant with a bright orange roof and clean, modern exterior, complete with large windows and the restaurant's logo prominently displayed above the entrance

Source: Wikimedia Commons

These expansions illustrate the company’s efforts to balance growth with strategic pullbacks, navigating through an unpredictable market landscape.

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