Casual dining continues to have its struggles on both the national and regional levels.

TGI Fridays has closed roughly 100 restaurants so far this year as speculation swirls about the chain possibly filing for bankruptcy, per multiple published reports, including this one from Restaurant Business. This news comes weeks after a deal for the iconic casual dining chain to be acquired by one of its franchisees fell apart.

Then there’s Denny’s, which expects to close 150 of its lowest-performing locations by the end of 2025, per the Associated Press. This represents about 10% of Denny’s total unit count. A spokesperson for the chain says some of the units are close to 70 years old and others saw traffic shifts during the pandemic that have yet to reverse. That’s one reason why Denny’s has been leaning into virtual brands a bit more. And that effort is paying off. During Denny’s third fiscal quarter, virtual brands accounted for 20% of its sales, per a Restaurant Dive report. While that’s 10 percentage points less than in 2020, which was during the peak of the COVID-19 pandemic, it’s nearly twice as large as Denny’s off-premises business in 2018 and 2019.

On a regional level, Shari’s Café and Pies closed all 42 of its restaurants in Oregon, per multiple published reports, including this one from Oregon Public Broadcasting. A regional favorite, the chain now has 17 restaurants left systemwide.

Undoubtedly, some of casual dining’s woes are inflation-related. Restaurant prices increased 3.9% for the 12-month period ending in September, which is 2.6% greater than grocery store prices, per the U.S. Bureau of Labor Statistics.

Of course, the news is not all bad for casual dining restaurants. Texas Roadhouse, for example, is on an impressive growth trajectory. The chain reported an 8.5% increase in same-store sales for corporate locations during the third quarter of 2024, per Nation’s Restaurant News. In 2017, the chain was a $2 billion company with 547 restaurants, as FSR reports. It doubled to more than $4 billion over the next five years and as of 2023, Texas Roadhouse was on its way to becoming an $8 billion company over the next decade.

Foodservice News

• With many restaurant chains struggling financially, 7-Eleven is turning to foodservice to enhance its financial position. That was the message from the C-store chain when it unveiled plans to open 600 large-format locations in the U.S. by 2027, as reported in C-Store Dive. The company’s New Standard format will include a 7-Eleven-developed concept Laredo Taco Company as well as made-to-order specialty beverages, self-serve specialty coffee, a cold treats bar, mobile checkout and delivery capabilities. 7-Eleven has been testing new concepts for a while.
• McDonald’s food safety struggles from the last week should serve as a reminder of how much goes into creating food-safe environments. In the unlikely event that you missed it, McDonald’s was dealing with an E. coli outbreak that was originally thought to be from its beef patties. It was later determined, though, that its fresh onion slivers were the likely culprit. Food safety fundamentals are well documented: cleaning and sanitization of workspaces; proper hygiene for staff, including handwashing and not showing up to work while ill; storing food at proper temperatures and more. Equally important, though is how the food is sourced and handled before it gets to a foodservice operation. As was discussed in the 2024 FE&S Food Safety Webcast, it’s important for operators to understand how their suppliers function and to visit their businesses to ensure they meet the restaurants’ standards.
• Add “kidult” to the growing list of demographics restauranteurs are trying to reach. The term refers to an adult who likes doing or buying things typically intended for children, per this Food Institute Focus. Restaurants are capitalizing on this phenomenon in a variety of ways. Taco Bell, for example, is launching its Decades Menu, which includes such blasts from the past such as its Meximelt from the 1980s and Apple Empanada from the 2000s.
• Is it possible to run a restaurant out of your house? If you live in Sonoma County, Calif., the answer will soon be yes, per a Realtor.com story. The Sonoma County Board of Supervisors approved California’s Microenterprise Home Kitchen Operations (MEHKOs) ordinance. The state program allows meals to be delivered, picked up, or eaten at a residence. However, these businesses must remain small. Under this program, food sales must be limited to 30 meals a day or 90 a week, with gross profits from sales capped at $100,000 per year. The house also must be a primary residence—so second homes, vacation homes, and motor homes aren’t eligible.

Economic News

• Consumer confidence bounced back big time in October. The Conference Board’s Consumer Confidence Index totaled 108.7 for the month, up sharply from September’s reading of 99.2. The Present Situation Index increased by 14.2 points for a reading of 138.0. The Expectations Index increased by 6.3 points for a reading of 89.1, significantly greater than the threshold of 80 that usually signals a recession ahead. This represents the strongest monthly gain since March 2021.
• The housing market offered mixed results in September. First, the good news: September sales of new single-family houses increased 4.1% compared to the previous month, per data from U.S. Census Bureau and the Department of Housing and Urban Development. This also marks a 6.3% increase compared to September of 2023. September 2024 represented the highest level of new home sales in 17 months thanks, in part, to lower interest rates bringing consumers back to the market, as a MarketWatch story explains. Now the bad news: sales of existing homes declined 1.0% in September compared to the previous month and 3.5% from the same period in 2023, per the National Association of Realtors.
• Consumer sentiment improved for the third consecutive month, per data from the University of Michigan. The Index of Consumer Sentiment came in at 70.5 for October, its highest reading since April of 2024. The university attributes the 0.4-point gain from the previous month to “modest improvements in buying conditions for durables, in part due to easing interest rates.”
• Initial jobless claims declined by 15,000 for a total of 227,000 for the week ending October 19, 2024, per the U.S. Department of Labor. The 4-week moving average was 238,500, an increase of 2,000 from the previous week. The news was not all good, though, as continuing claims increased by 28,000, the highest level in three years, per Reuters. Further, the decline in initial claims is likely related to an ebb in claims related to Hurricane Helene, which had significantly boosted claims earlier in the month.
• The number of job openings totaled 7.4 million on the last business day of September, the U.S. Bureau of Labor Statistics reported. This is slightly less than the 8 million openings in August. Overall, job openings have declined by 1.9 million for the year. In September, hires totaled 5.6 million, which is slightly greater than the 5.2 million separations.