Restaurant premises liability claims may slip and fall as consumers reportedly pull back from dining out.
The number of restaurants dropped from a peak of 638,000 in 2014 to about 624,000 in 2016, according to an October, 2016 article in The Wall Street Journal titled “Restaurant Chains Get Burned by Overexpansion, New Rivals.” The decline also reflects independent restaurants that closed as a result of competition from chains.
Eight bankruptcy filings from restaurant operators in 2016 call for restaurant closures as part of detailed restructuring plans. Filers include Boston-based soup and sandwich chain Cosi Inc., Don Pablo chain owner Rita Restaurant Corp., and Garden Fresh Corp., known by its brand names Souplantation and Sweet Tomatoes.
Other chains are pulling back on locations in an effort to protect profitability. Ruby Tuesday Inc. closed almost 100 restaurants in September, and Bob Evans Farms Inc. closed almost 50 of its 548 restaurants in the past year.
Contributing factors in the pull-back include over-expansion, new competitors like Blue Apron and grocery stores in the pre-packaged meal category, and fewer business lunches as more people work from home.
Industry observers predict that it may take 5-10 years before the casual-dining and fast-casual restaurant sectors adjust to competition from the growing off-premise dining segment.
Panel Counsel Marketing Tip: Premises liability panel counsel members with a focus on the restaurant sector may want to start broadening their base of panel appointments to offset a potential decline in restaurant premises liability claims.
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