The chain restaurant industry has battled a series of economic problems over the past five years that have led to store closures and bankruptcy filings.
Some fast food chains, such as Long John Silver’s, have reduced business since the Great Recession of 2008.
More recently, when inflation raised labor and food costs since the Covid-19 pandemic in 2020, menu prices also increased significantly, discouraging diners from eating out.
Rising costs lead to closures
Labor and food costs increased 35% from 2019 to 2025, according to the Bureau of Labor Statistics, and restaurants often passed along the additional costs to their customers, with menu prices increasing by an average of 31% from February 2020 to April 2025, the National Restaurant Association reported.
Rising restaurant costs contributed to a slowdown in sales, which hit their lowest growth rate since the Great Recession of 2008, excluding the Covid pandemic, according to the 2026 Technomic Top 500 Chain Restaurant Report.
“It was a very, very weak year for the Top 500 overall from a sales perspective,” said Joe Pawlak, CEO of Technomic, according to Restaurant Business.
Long John Silver’s closes hundreds of locations
The challenging restaurant environment has led the 57-year-old fast-food chain Long John Silver’s to close about 706 restaurants nationwide since the Great Recession in 2008.
The fast-food seafood restaurant chain, which opened in Lexington, Kentucky, in 1969, had 1,081 locations at its peak in 2007, but began to decline the following year, closing 59 locations as the financial crisis began to impact the restaurant industry.
Restaurants file for Chapter 7 bankruptcy
Some of the restaurant chains victimized in the first year of the financial crisis included Starbucks, which closed more than 600 locations, according to CBS News, and the owners of the Bennigan’s and Steak & Ale chains, S&A Restaurant Corp., which filed for Chapter 7 bankruptcy in 2008, Reuters reported at the time.
Franchisees of the Bennigan’s and Steak & Ale chains did not file for bankruptcy at the time.
Long John Silver’s continued to close more restaurants in the years that followed, closing 33 in 2009, 25 in 2010, 32 in 2011, 21 each year in 2012 and 2013, and then a much larger closure of 75 locations in 2014, ending the year with 815 units, according to QSR magazine.
Chain has 375 stores after closures
Over the next 10 years, Long John Silver’s closed 330 locations and ended 2024 with 485 restaurants. The fast-food restaurant chain closed another 110 units in the last year and a half, and its website locator lists 375 stores in total at last check.