I’ve got good and bad news for you. The bad news is there are less opportunities to get baby-back ribs at Chili’s Grill & Bar than there were only a year ago with select locations closing their doors. The good news? This American fast casual chain still has more than 1,500 restaurants located all over the world.
In this post, I share the reasons rumors of Chili’s Grill & Bar going out of business have gained traction the past 12 months even if they aren’t true. I’m also share the full story about location closures and other headwinds the company is facing right now.
Where have Chili’s Closed Locations So Far?
First thing’s first: Chili’s is not closing down for good. Yes, they are facing some financial woes and closing down certain locations. But they still have a presence of more than 1,500 units at the time of writing.
But it’s easy to understand why some customers might incorrectly think that the chain is going out of business based if locations near them have all but disappeared.
For example, a Chili’s in Dunwoody in the Ashford Place shopping center that has been around since 1993 has closed down in August, 2023. Staff was informed about the news just two weeks prior to the closing date although no official announcement was disclosed to the public at the time.
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Another long-time Chili’s location in San Luis Obispo County closed in June, 2023. This was the last remaining Chili’s in that area. Again, no public announcement was given as to the specific reasons behind the closure.
Other Chilis that were reported to have closed recently were in the following locations:
- Chili’s The Avenue West Cobb
- Chili’s MacArthur Center, North Folk
- Chili’s Parkway Commons, Franklin
In 2023, Chili’s Grill & Bar also closed down an innovative delivery only concept in Dallas located near the Southern Methodist University. This concept was only open for 2 months before the company decided to close the doors on the concept.
Why Is Chili’s Closing?
Chili’s has never stated why they closed the restaurants mentioned above but one could make an educated guess why certain located have shuttered.
One obvious reason could be the tough competition that the casual dining scene is facing. Similar restaurants like Applebee’s have reportedly been closing down their restaurants due to underperformance. There are a few reasons for the decline in units that also impact Chili’s.
Some Applebee’s locations are over 20 years old. As a result the neighborhoods around them evolve, especially post-pandemic. As Applebee’s CEO John Peyton pointed out, some malls and areas just don’t pull in the crowds like they used to, thanks to the shifts accelerated by COVID. Considering Chili’s opened their first restaurant all the way back in 1975, it’s likely facing similar challenges in some areas.
Restaurant chains also need to contend with rising development costs, which have surged by 30% in recent years. This financial hurdle has significantly slowed down new openings in more appealing locations.
Of course, the changing taste preferences of consumers can’t be ignored either. Millenials and Gen Z’s don’t dine at chain restaurants as often as their parents and grandparents.
Is Chili’s closing near you?
In addition, the menu at Chili’s and other casual dining places are more expensive that the fast-casual scene. In an effort to update their menu offerings Chili’s started selling craft beer to appeal to the younger crowd and tested more affordable their menu items to appeal to a wider range of budgets.
And if that’s not enough, Chili’s suffered a data breach in 2018. The breach happened in March and April but Chili’s didn’t report anything until May. Credit and debit information were stolen during this malware attack on their payment systems. Chili’s suffered a huge blow with regards to this issue as some consumers feared their personal and financial data wasn’t safe.
It’s clear that there’s no one specific reason Chili’s is closing certain locations. It’s a combination of changing diner preferences, outdated locations, and rising costs that have plagued many legacy restaurant chains.
Who Bought Chilis?
Chili’s is owned by Brinker International. This is the same investment firm that owns Maggiano’s Little Italy and It’s Just Wings. Brinker International’s total revenue in 2022 was $3.8 billion.
How many Chilis stores are left in the US?
According to reports, there are still more than 1,500 Chili’s units in operating. They’re located in 49 states and territories with Texas having the most number of Chili’s restaurants at 219. There are also several Chili’s restaurants in Florida, California, and Illinois. To know where exactly is a Chili’s located in each state and city, you can check out the full list of their locations found on their website here.
What is Chili’s Doing to Turn Things Around?
As you can see, Chili’s Bar & Grill has faced numerous challenges the last couple years. But that doesn’t mean the brand is at risk of going out of business either. The company is taking actions to adjust to changing consumer preferences and macro economic challenges like inflation.
One of their strategies is adding Brinker International’s virtual brand It’s Just Wings to a Chili’s restaurant. It’s Just Wings is Brinker’s successful ghost kitchen brand that is now available to order at Chili’s. Brinker International is hoping this can drive in sales for Chili’s as well and drive in more traffic to their restaurants.
Chicken tenders at Chili’s.
Chili’s is also adding more emphasis to value meals on their menu. For instance, they’re offering a 3 for Me meals that includes an appetizer, an entrée, and a beverage for $10.99. They’re also offering Margaritas of the Month to drive more high-profit bar and liquor sales.
But it’s not all just about offering new items on the menu or creating value meals. Chili’s is also listening to staff to improve restaurant performance. This includes returning the role of busers so that servers can focus on guests and eliminating redundant tasks from old practices that no longer make sense.
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Chili’s and Brinker International faced an operating loss of more than $50 million in the fourth quarter of 2020 in the depths of global health crisis. Fortunately, the companies business performance has improved since the world opens their doors again and has returned to profitability.
Chili’s has a long way to go in order to increase their sales and boost up revenue but fans of the bar and grill can look forward to the change and be rest assured that their favorite restaurant is doing everything they can to increase foot traffic.
I hope this article has eased your concerns that Chili’s is going out of business. The restaurant chain is actively working on executing a turnaround that management expects will increase traffic and revenues to this iconic brand over the next 12 – 24 months.