Big mistake that led to Hooters bloodbath (2024)

You might have assumed a diner with jugs of beer and trays of chicken wings served by women in teeny tiny shorts would have been cost-of-living proof.

Apparently not.

The famous, perhaps infamous, Hooters restaurant chain has announced that it will close more than 10 per cent of its US stores due to “underperformance”. Its management have said the company, famous for its buxom servers, remain “highly relevant”.

However, a series of unforced errors and some bizarre investments have hampered Hooters for years and allowed competitors – with equally skimpy clothes but bigger menus – to catch up.

Hooters used to have a substantial Australian presence but, in an early sign of troubles that would befall the US arm, it is now down to a single store in Sydney’s west.

On Sunday, US time, rumours started circulating that a number of Hooters stores, known for female wait staff clad in orange shorts and tight white tank tops, were shutting up shop.

Hooters, which the company mockingly insists is named after its owl mascot Hootie, confirmed it will immediately close 40 of its remaining 300 US stores, around 13 per cent of the total that were trading.

That follows a reduction in locations by around 12 per cent in 2018. At one point Hooters had more than 400 stores worldwide.

Hooters is the latest US restaurant chain to announce large numbers of store closures. Last month, venerable seafood outlet Red Lobster announced it was also in dire straits.

“Like many restaurants under pressure from current market conditions, Hooters has made the difficult decision to close a select number of underperforming stores,” the company, which is owned by private investors Nord Bay Capital, told US newspaper USA Today in a statement.

“Ensuring the wellbeing of our staff is our priority in these rare instances,” it continued.

Hooters ‘highly relevant’

“This brand of 41 years remains highly resilient and relevant,” the company insisted.

“We look forward to continuing to serve our guests at home, on the go and at our restaurants here in the US and around the globe.”

While the company didn’t provide a list of Hooters that were shutting, there were reports that some sites in Texas, Florida and Kentucky had served their last shrimp platter.

Hooters’ big mistakes

The pandemic and subsequent cost of loving issues are hurting industries that rely on discretionary spending – like restaurants. Especially those chains that are aimed at more cost conscious consumers.

But industry watchers have said Hooters had some unique problems all of its own.

One was its menu, which has barely evolved over the years and remains limited.

Then there’s the financial strain wrought by some bizarre offshoots.

These included a Las Vegas casino which was a money pit and only changed management away from Hooters in 2019. It still has a Hooters inside but, hidden in a dowdy off strip casino, it hardly exudes all the excitement of Las Vegas.

It even once ran an airline, which no longer flies.

Recently, multiple changes of management and CEOs have seen it veer from one strategy to another in a bid to win back customers.

Of course, many consumers find it uncomfortable and perhaps off putting to dine in a restaurant where the wait staff are wearing relatively skimpy clothes and that may have turned away some customers.

However, rival restaurants of the same ilk are doing well. Twin Peaks bills itself as a sports bar staffed by “beautiful, friendly and attentive Twin Peaks Girls” which “ensure every guest feels like a regular”.

Its uniforms consist of small jean shorts and a red plaid shirt revealing the midriff in a nod to its mountains them and revealing even more skin than Hooter’s staff.

But beyond that, Twin Peak’s branches are more themed, larger and buzzier and have a more extensive menu with contemporary choices like flatbreads, tacos and avocado smash burgers.

Australian Hooters all but closed

Hooters opened stores in Australia to capitalise its then success.

But in 2018, the US owners sold its remaining branches which were located in Parramatta, Penrith and Campbelltown in Sydney, the Gold Coast, Townsville and elsewhere. Only the Parramatta location remains.

Hooters opened its first store on October 4, 1983, in Clearwater, Florida by six business man who, the Hooters website proclaimed, had “absolutely no previous restaurant experience,” and wanted to “open a place they couldn’t get kicked out of”.

The menu of all American favourites, from burgers to wings, served by scantily clad young women was a winner.

In 1986, Hooters released its first calendar featuring a selection of its female wait staff.

‘US restaurant chains struggle

Hooters’ management has insisted its future remain secure and it may even open more stores.

But there’s no denying the US casual restaurant market is struggling. Americans are tightening the purse strings and there is an oversupply of chains some of which have failed to excite modern palettes.

In May, seafood chain Red Lobster said it had filed for Chapter 11 bankruptcy protection just days after it announced it was shuttering almost 100 stores.

Founded in 1968, like Hooters, in Florida, Red Lobster expanded across the US and Canada with restaurants even popping up in Japan, Thailand and Ecuador.

Lobster, crab legs and prawns were the star menu item with no meal complete without a side of Cheddar Bay savoury scones.

At its height, Red Lobster had more than 700 branches but analysts said the brand and stores had become tired.

It was then battered by Covid, cost of loving and some questionable management decisions.

“This restructuring is the best path forward for Red Lobster,” said CEO Jonathan Tibus.

“It allows us to address several financial and operational challenges and emerge stronger and refocused on our growth.”