Biggest sports bar chain closes locations before football season
Transcript: Daniel Kline: Hey, it's Dan Kline, co-editor-in-chief of The Street. I am standing in Eden, a restaurant on Celebrity Beyond. Cruise ship restaurants don't go out of business. They get replaced. Uh, they get upgraded. But we get asked at The Street, why are there so many stories about restaurants going out of business? Is this just something you guys cover every one or are the numbers going up? No, there's actually an increase. Why is there an increase? Well, really, it's kind of a whole bunch of bad news coming together at once. Labor prices are up. Food prices are up. People's incomes might not be down, but they feel like they're down, because all the prices are up. People are worried about losing their jobs. So if I'm worried about losing my job, I'm not going to go to the steakhouse. Maybe I'm going to trade down and go to Wendy's or go to, go to Chili's. So you're seeing a lot of restaurants, but restaurants operate on pretty razor-thin margins. So, if you're, say, like, a Red Robin, which has closed a bunch of restaurants recently, and the price of beef go- goes up, and the price of beef has gone sky-high, and they're a burger chain, well, all of a sudden they were making X amount, and that gets tight, and if they have debt they're paying off, of which many restaurant chains do because of the pandemic, all of a sudden, even though they're making a profit, they don't have enough money to cover what they owe. They don't have enough money to hold onto their workers. So one other thing. I am on a GLP-1 drug. I've lost some weight. That is a good thing. But when I go to a restaurant now on a Friday night or Saturday night, I normally would've had an appetizer, an entree, maybe a dessert. Now, I'm having an entree, and I'm bringing some of it home. So that's one more meal I'm not eating out or not buying from a grocery store. So take all those things together, and it's not some strange wave of restaurant closures. It's a bunch of pressures all on restaurants all at the same time, forcing them out. It might not get better anytime soon, because if people don't feel like they're secure in their job, they're going to cut back on restaurants. I am Dan Kline, co-editor-in-chief of The Street.
Casual dining restaurants have to walk a tightrope when it comes to offering strong value and a good customer experience. Chili's has succeeded in finding the right mix of price, value, and experience that keeps the chain affordable while differentiating it from fast-food and fast-casual chains.
"Chili's was the unquestionable same-store sales champ in 2025, though this has set the brand up for some difficult comps periods," Restaurant Dive reported. "…In its most recent quarter, that success was driven primarily by traffic growth, a remarkable feat at a time when many brands faced stagnant or reversing traffic."
Other chains, including Red Lobster, Ruby Tuesday , and Applebee's, have shrunk. On The Border filed Chapter 7 bankruptcy, and only a handful of franchised locations remain, while Bahama Breeze was shut down by Darden, its parent company.
Buffalo Wild Wings, another casual dining chain going after that same audience, has also been closing restaurants. It's selective, and the chain has opened some new locations as well, but that's cold comfort to people who watch their nearby location shut down.
Restaurants have struggled to copy Chili's model
Chili's success has been driven by its value offerings. That's something Brinker CEO Kevin Hochman talked about during the Chili's parents company's fourth-quarter earnings call .
"Instead of using precious resources and investments on initiatives to drive short-term sales, we at Chili's focus our resources for long-term sustainable growth. Improving food service and atmosphere and the team member experience, as well as positioning our brand to be more relevant, easy, and distinctive," he said.
The chain's efforts have allowed Chili's to actually be cheaper than its rivals.
"These experience improvements coupled with our everyday value leadership represented by a per person average spend that is $3 to $4 below competition, are supporting a powerful flywheel of traffic, sales growth, margin expansion, and then reinvestment into our business," he added.
Rivals, including Buffalo Wild Wings, have struggled to find a similar mix of value and experience.
One of the major issues has been food and labor costs, which have increased by 35% in the last five years. Average menu prices also rose 31% from February 2020 to April 2025, according to the National Restaurant Association .
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