Red Lobster closures: Why restaurant chains are struggling

LONG ISLAND - Some Long Islanders are among those upset that the nationwide chain, Red Lobster, which’s been around since 1968, abruptly closed dozens of its restaurants, including one in Stony Brook on Long Island. 

RELATED: Red Lobster closures: List of New York locations shutting down

The restaurant that prides itself on seafood with standards will auction all of its equipment and furniture from fifty of its locations. 

"Servers are getting a minimum wage of $20 an hour, add that to food prices increases due to supply chain issues and inflation, then restaurants have to increase their selling prices," said economist Dr. Martin Cantor. 

FILE - Red Lobster in Leesburg, Florida, on May 15, 2023. (Stephen M. Dowell/Orlando Sentinel/Tribune News Service via Getty Images)

Applebees, Outback Steakhouse and Carrabba’s are among other restaurant chains that have closed in some communities. Experts say credit card processing fees tacked onto bills doesn’t make it any easier. 

"The restaurants that were having problems with their competition are going to find the competition will drive them out of business," Cantor said.  

Restaurant Business Online reported earlier this year, that menu prices at full-service restaurants have jumped close to 4% over the past year, while prices at fast food spots have been up just over 5% during the same time. Compare this to at-home food prices, up just 1%.