One of the greatest thrills, as an American, is finding the best and biggest portion at a restaurant for the cheapest price point.
It gives us purpose, meaning, and something to root for, especially when our favorite football team has a bye. Some might even say it unites us as a nation and makes our country the political and economic powerhouse that it is now. That, and the iPhone.
Related: Apple may be planning an unprecedented update for this key product
Cheap dining is something Americans will defend to the core. It's partly what's propelled McDonald's to such international success. It's why so many of our towns are peppered with strip malls and drive-thrus, rather than ornate cathedrals or municipal buildings with Corinthian columns and priceless 16th century frescoes.
Americans favor convenience, efficiency, large portions and bargains. We don't have a lot of time for details or long savory moments. We like to keep things moving.
One detail we do notice, however, is when prices go up. And one popular chain restaurant may be about to find that out the hard way.
Red Lobster raises prices for popular dish
Perhaps one of the most best examples of American ingenuity can be found at Darden Restaurants DRI, which owns and operates establishments like Olive Garden.
Olive Garden is beloved for its quality meals that come in large quantities at reasonable price points. It offers unlimited soup, salad, and breadsticks for $11.99.
Thai Union Group-owned Red Lobster began offering a similar model with its Endless Shrimp, whereby guests could order different types of unlimited shrimp, like Garlic Shrimp Scampi or Shrimp Linguini Alfredo, for just $20.
The offer was brought back just in June in an effort to boost foot traffic and generate excitement about the brand.
Now, however, the deal has almost been too good to be true from a financial standpoint.
“We knew the price was cheap, but the idea was to bring more traffic in the restaurants,” Thai Union CFO Ludovic Regis Henri Garnier said in a the Q3 earnings call. “So we wanted to boost our traffic, and it didn't work."
Thai Union reported a net income of $1.21 billion, down 52.34% year-over-year. The group is also expecting a $20 million loss on Red Lobster for the full 2023 year -- up from its original expectation of $17 million.
To that end, Red Lobster will raise the prices of its unlimited shrimp to $25.
“We want to keep it on the menu,” Garnier added. “And of course we need to be much more careful regarding what are the entry points and what is the price point we are offering for this promotion.”
As for the future of Red Lobster, Garnier is cautiously optimistic.
“We are really monitoring very closely the situation in order to improve the operation and the efficiency and the marketing of Red Lobster,” Garnier said. “And then on the flip side … we also have the support from the advisors to see, what are we doing in the mid-term and also in the long-term with the business? … So this right now is the focus we are working on.”
