Red Lobster Files for Bankruptcy

American seafood chain Red Lobster has filed for Chapter 11 bankruptcy after a decade of struggling with rising prices and increased competition, reports NPR.

The report noted that the chain’s recent issues were elicited by poor decisions at the executive level, including a failed all-you-can-eat shrimp campaign. Thai Union Group, a seafood supplier and the retailer’s largest shareholder, alleged that the promotion was the main cause of its $11 million loss that quarter.

The campaign's intention to get more people in the door was met with success; however, customers stayed for hours, ate more shrimp than anticipated, and ordered little else, according to the report.

Red Lobster CEO Jonathan Tibus said in the court filing that myriad factors were to blame, including mishandled strategic initiatives.

Red Lobster’s issues include "a difficult macroeconomic environment, a bloated and underperforming restaurant footprint, failed or ill-advised strategic initiatives, and increased competition within the restaurant industry," wrote Tibus. 

Nearly 580 locations across the U.S. and Canada are expected to stay open through the process, according to the report. Last week, dozens of other locations abruptly shuttered and their contents have been auctioned off. Full Story