TGI Fridays is making headlines once again as the casual-dining chain recently closed at least 12 locations across the United States over the past month. This latest round of closures comes on the heels of declining sales and increasing operational costs that have plagued the brand in recent years.
TGI Fridays’ Recent Store Closures
According to Restaurant Business, the TGI Fridays locations that shut down last week were in Leesburg, Virginia; Allentown, Pennsylvania; Middletown, Poughkeepsie and Clifton Park, New York; and Enfield, Connecticut.
Earlier closures over the past month were in Charlotte, North Carolina; Charleston, South Carolina; Grand Chute, Wisconsin; Saginaw Township, Michigan; Schererville, Indiana; and St. Louis Park and Edina, Minnesota.
The Reason Behind the Latest Store Closures
Since TGI Fridays has yet to comment on the latest wave of store closures, the reasons behind these location shutdowns remain unclear. According to reports by local media, notices posted on the doors of the closed restaurants simply stated that the decision to cease operations was “difficult” and directed customers to nearby locations.
For years, TGI Fridays has faced significant challenges as consumers increasingly turn away from traditional casual-dining brands. Over the past decade, the chain has shuttered nearly half of its U.S. restaurants, with systemwide sales plummeting 15% last year, according to data from Technomic, a sister company of Restaurant Business. Additionally, the company has undergone considerable leadership turmoil, experiencing four CEO changes since the start of 2023.
As of October 15th, TGI Fridays’ website reported that it operates 215 locations across the United States.
TGI Fridays’ Financial Woes Worsen as Acquisition Plans Collapse
TGI Fridays’ financial troubles escalated last month when a trustee terminated the chain as the manager of its business securitization. This decision, attributed to an overpayment of management fees, led to a backup manager taking control of certain operations, including the franchise business and royalty stream.
The uncertainty created by this termination prompted United Kingdom franchisee Hostmore PLC to abandon its plans to acquire TGI Fridays. Hostmore subsequently filed for bankruptcy in the U.K. and closed 35 locations. Prior to these developments, the two companies had been working together to sell their remaining corporate stores to reduce debt.
TGI Friday’s Humble Beginnings
Founded in 1965 by Alan Stillman in New York City, the first TGI Fridays was envisioned as a place where singles could meet and socialize in a friendly, laid-back atmosphere. With its signature red-and-white striped awning and a warm, welcoming ambiance, the laid-back singles bar quickly became popular among locals.
The concept was revolutionary at the time, combining a lively bar scene with an extensive menu of American comfort food. Its casual vibe, innovative cocktails, and strong emphasis on customer experience distinguished TGI Fridays from traditional dining establishments. As word spread, the brand began to expand, introducing new locations across the U.S. and later internationally.
As of last year, TGI Fridays has over 600 restaurants worldwide. But as the brand struggles in the U.S. and some international markets, it remains to be seen whether it can successfully adapt to the shifting consumer preferences and economic pressures affecting the whole casual dining industry.