In May, Red Lobster filed for bankruptcy, marking the end of a chapter defined by its ill-fated “Endless Shrimp” offer. The company, burdened by mounting losses, shuttered more than 50 locations as it grappled with the fallout.

The Crustacean Conundrum

In August, Red Lobster brought in a new helmsman, Damola Adamolekun, a former P.F. Chang’s CEO. At just 35, Adamolekun faces the formidable task of reviving the 56-year-old restaurant chain, which has been struggling to stay afloat ever since the restaurant’s ill-conceived “Endless Shrimp” promotion, which Adamolekun cited as a key misstep in recent years.

The promotion, though popular with diners, was financially disastrous for Red Lobster. Shrimp is an expensive commodity, and offering it in unlimited quantities strained both the company’s balance sheet and its staff. “When you have endless shrimp, and people are sitting down at the table for hours, eating as much shrimp as they can, you stress out the kitchen, the servers, and the host,” Adamolekun explained. The promotion, launched in June 2023, allowed diners to indulge in two shrimp dishes for USD 20, but the move backfired spectacularly, contributing to an USD 11 million loss and ultimately leading to the company’s bankruptcy.

The Costly Appeal of Endless Shrimp

Despite the chain’s best intentions, its shrimp promotion created significant challenges beyond just financial losses. The constant demand for shrimp led to operational chaos in many locations, with servers and kitchen staff overwhelmed by the volume of orders. Guests, often lingering for hours, further complicated matters by clogging tables and lengthening wait times, making the dining experience difficult for everyone involved.

Thai Union Group, Red Lobster’s investor, noted the promotion’s direct role in the company’s struggles. “We wanted to boost our traffic, and it didn’t work,” said CFO Ludovic Regis Henri Garnier. The strategy to make endless shrimp a permanent menu item, rather than a limited-time offer, proved to be an expensive error. The group now plans to fully divest from Red Lobster by the year’s end, distancing itself from the financial toll the seafood chain has taken.

A Bigger Sea of Problems

While shrimp may have been the most glaring issue, Red Lobster’s woes are part of a broader problem. The COVID-19 pandemic, industry challenges, rising material costs, and labor shortages compounded the company’s difficulties. Thai Union Group’s CEO, Thiraphong Chansiri, acknowledged these factors, stating they had “resulted in prolonged negative financial contributions to Thai Union and its shareholders.”

Despite these pressures, Adamolekun remains committed to turning Red Lobster around.

Charting a New Course

Adamolekun’s vision for the future of Red Lobster is not just about expansion but also about making each existing location more efficient and welcoming. “We intend to be done closing restaurants,” he said, emphasizing that investments in infrastructure, technology, and menu refinement will be essential to the brand’s revival. Fixing broken HVAC systems, repairing torn carpets, and improving furniture are all part of the immediate changes.

The new CEO is also planning a more focused menu. The previous abundance of options overwhelmed diners and kitchens alike, so streamlining the offerings will play a critical role in the company’s recovery. Adamolekun has already taken steps to immerse himself in the brand, secretly visiting locations across the country to better understand its strengths and weaknesses. Customers “just want quality food in a comfortable setting,” he said, highlighting a simpler approach to meet consumer expectations.