Hooters is the latest legacy restaurant chain to encounter financial difficulties amidst the high food and labor prices, changing customer preferences and growing competition with new casual chains like Shake Shack.
The US restaurant chain has filed for bankruptcy protection. HOA Restaurant Group filed a Chapter 11 protection claim Monday with North Texas Bankruptcy Court in Dallas.
Last May, it was Red Lobster, and then its endless shrimp trade was much debated. In August, Italian chain-dovey Beppo sought court protection.
TGI Fridays filed for bankruptcy last fall, but the border Tex-Mex chain filed for bankruptcy protection last month.
Hooters and TGI Friday operated in Oregon. Red lobster is still the case.
Under the Hooters Bankruptcy Plan, 100-owned American restaurants will be sold to a group of Hooters franchisees. The franchisee, including the founder of Hooters, currently operates 14 of the 30 highest-capacity Hooters restaurants in the US, the company said.
Hooters, known for their chicken wings and their skimpy “Hooters Girl” wait staff outfits, said the franchisee or license partner will continue to operate all existing locations, including locations outside the US.
Last year, the Atlanta-based company closed about 40, which performs poorly at US locations.
Hooters was founded in 1983 by six businessmen in Clearwater, Florida. He insisted that he had no experience in foodservice and would rather run a restaurant that would not be kicked out.
But its business strategy has faced many years of challenges, including a lawsuit that only hires “Hooters Girls” to serve customers. In 2017, the company opened a restaurant that did not have a server with tight tops as a test of a different approach to the original concept.
Last year, Hooters agreed to pay $250,000 to resolve a racial and color discrimination lawsuit brought on by the Equality Committee of the U.S. Employment Opportunity Committee. According to the lawsuit, Hooters in North Carolina fired 43 employees during the community pandemic, but when they began rehiring workers, they recalled that mostly white and black employees had lighter skin tones.
