I thought it died a decade ago. Really. Like some of you, I took my prom date to a Steak & Ale restaurant, and spent many hours (and dollars) in Bennigan’s in my formative years. BITD (back in the day) it was the quintessential place to go and pick up chicks, and generally be cool, especially for those of us who lived where a TGI Friday’s had not yet opened.
I also called on Metromedia in Dallas for years when I was in chain accounts. I remember when Bennigan’s brought in a creative hot shot into menu development, and he really put Bennigan’s on the map as a true competitor to TGIF in the small but growing “casual” segment. Wonder whatever happened to him?
The death of S&A and Bennigan’s is the tip of the iceberg I’m afraid. Although both chains had fallen from their pedestal well over a decade ago, they still are representative of the pressure that the midscale casual segment is experiencing in this economy. Fast food and fast casual have both grown in sales as diners rationalize their FAFH (food-away-from-home) dollars. In addition, restaurant companies are traditionally over-leveraged, especially during the last few years of easy capital access. As soon as some chains cash flow dips below their operating expenses, more unit closings and bankruptcies will occur. The latest indicators point in that direction: same store sales soft, smaller portions, unit closings, lower EBIDA, etc.
But lets be honest. This segment is overbuilt. If there was a DARWIN in the restaurant business, he would have predicted that "the fit will survive". Don't bemoan the loss of Steak & Ale or Bennigan's. They brought it upon themselves by not "evolving" with today's consumer.
The other side of the coin is that there will be chains who are doing all the right things, but the economy simply won't let them survive. That's part of evolution as well.