Source: Daily Mail

• Ruby Tuesday, which was founded in 1972, is filing for bankruptcy protection 
• Said that its restaurants will remain open throughout the bankruptcy process 
• Casual chain based in Tennessee said it will close 185 locations for good 
• It has 236 remaining company-owned and franchised locations in the U.S. and 10 other countries  
• Company has been accused of closing locations without notifying employees
• Even after reopenings, visits to full-service restaurants in the U.S. were down 25% as of August 

By TREVOR BOYER FOR DAILYMAIL.COM and ASSOCIATED PRESS

Ruby Tuesday is closing 185 locations for good and filing for bankruptcy protection, the latest casual restaurant chain to suffer from coronavirus-related closures and changing consumer habits.

The Maryville, Tennessee-based company, which was founded in 1972, said on Wednesday that its remaining restaurants will stay open throughout the bankruptcy process.

Ruby Tuesday will go forward with 236 company-owned and franchised restaurants in the U.S., Canada and nine other countries, including Hong Kong, Chile and Kuwait, according to UPI. In 2009, there were 896 Ruby Tuesday locations.

‘This announcement does not mean “Goodbye, Ruby Tuesday,” CEO Shawn Lederman said in a statement. ‘Today’s actions will allow us an opportunity to reposition the company for long-term stability as we recover from the unprecedented impact of COVID-19.’

Visitors to New York’s Times square walk past a Ruby Tuesday restaurant. Ruby Tuesday is filing for bankruptcy protection, the latest casual chain to suffer from coronavirus-related closures and changing consumer habits. The Maryville, Tennessee-based company says its restaurants will remain open throughout the bankruptcy process

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Ruby Tuesday is known for its salad bar, which could be a difficult sell in a post-pandemic world. But it’s also dealing with longer term changes in the market that have hurt other casual chains.

Even before the virus hit, sit-down restaurants were struggling as more consumers opted for delivery and carryout. Restaurants, still clawing their way back from the recession a decade ago, had little cash to update their aging stores.

Los Angeles-based California Pizza Kitchen filed for bankruptcy protection in July, while the parent company of the Chuck E. Cheese pizza and entertainment chain filed for bankruptcy in June. Steakhouse chain Sizzler, also based in California, declared bankruptcy last month.

NPD Group, a data and consulting firm, said U.S. visits to full-service restaurants plunged 47 percent in the April-June period, at the height of the mandated dining-room closures. Visits have ticked upward since then, but were still down 25 percent in August.

Restaurants are COVID hotspots, according to a recent study by the Center for Disease Control. Compared to uninfected people, those who had newly tested positive for COVID-19 and couldn’t identify exposure to a specific infected person were three times as likely to have visited a restaurant in the prior two weeks.

CEO Shawn Lederman said bankruptcy does not mean ‘goodbye, Ruby Tuesday,’ but rather ‘an opportunity to reposition’

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Before the pandemic hit, the restaurant industry expected to clear $899 billion in sales in 2020. But in just the first three months of the shutdown, the industry lost $120 billion in sales, according to the National Restaurant Association.

Without counter service or drive-thru windows, sit-down chains like Ruby Tuesday simply haven’t been able to make up the lost volume from their dining rooms.

Since the onset of the pandemic this year, Ruby Tuesday closed some locations even receiving Paycheck Protection Program loans intended for small businesses, according to Business Insider.

Three Ruby Tuesday workers told the website that the chain often shuts down locations without first notifying employees.

The company employs about 7,300 workers. Most of them have been furloughed during the pandemic, according to UPI.

Private equity firm NRD Capital bought Ruby Tuesday and its debt for $146 million in 2017, the year after the restaurant chain closed 95 locations and put itself up for sale.

Ruby Tuesday has 236 company-owned and franchise locations after reportedly closing 185 this year. In 2009, the casual sit-down chain had 896 restaurants

 Chuck E. Cheese’s parent company, Sizzler, and California Pizza Kitchen all filed for bankruptcy this year amid the collapse in dining out during the pandemic