This week on Nation's Restaurant News the top story was Shake Shack to close 9 underperforming restaurants. Shake Shack will close nine company-owned restaurants by Sept. 25, the fast-casual restaurant said Tuesday, citing underperformance and possible cannibalization of other locations in the 527-unit system. In a filing with the Securities & Exchange Commission, the New York City-based fast-casual chain said that over the course of its regular portfolio evaluation it identified restaurants in California, Ohio, and Texas that were underperforming “in part due to changes in the trade area and, in some cases, are negatively impacting other Shacks within their proximity by cannibalizing sales,” it said.
In other news, Hooters has been slapped with a $1.7 million lawsuit over unpaid sponsorship money by NASCAR’s Hendrick Motorsports. Hendrick alleges the restaurant chain did not meet its obligation in sponsoring Chase Elliott’s No. 9 car in the NASCAR Cup Series. Court filings show Hooters made a payment of $45,000 in March but has not made payments since. The $1.7 million figure is the remaining money in the contract, according to the lawsuit, which was filed on July 30. Autoweek first broke the news, reporting that Hooters was obligated to provide sponsorship payments in four installments of $437,500 each in March, June, August, and October.
Also, it’s been a busy month for chief executive officer appointments in the restaurant industry, and BJ’s Restaurants is the latest chain to undergo such a change. The company announced Wednesday after market that Bradford Richmond will serve as interim CEO, effective immediately, after Greg Levin stepped down from his position, as well as from the board of directors.
See what else was trending on NRN.com this week.
