The restaurant and bar industry is facing a challenging period marked by significant closures, shifting consumer habits, and ongoing supply chain pressures. Over the past week, Wendy's announced plans to close hundreds of US locations by the end of 2025, targeting underperforming stores as part of its Project Fresh initiative. This follows the closure of 240 locations in 2024, with analysts estimating that up to 5 percent of its 6,011 US restaurants could be affected. The move is driven by rising costs, outdated infrastructure, and the need to streamline operations amid persistent inflation and supply chain disruptions.
Meanwhile, Red Robin reported a 3 percent decline in comparable restaurant sales for the fourth quarter of fiscal 2025, though its adjusted EBITDA improved by 86 percent year-over-year, reaching $58 million. The company credits its First Choice plan and labor efficiency for these gains, signaling that operational improvements are helping some chains weather the downturn.
In Europe, the bar sector is adapting to new consumer behaviors. The Global Bar Report 2025 highlights a trend toward lower alcohol consumption, with more patrons opting for zero-ABV drinks or smaller, premium cocktails. This shift is partly attributed to the popularity of GLP-1 weight-loss drugs and a broader move toward mindful drinking. Luxury hotel bars, however, are bucking the trend, with five-star venues like Avra Bar in Athens and Eagle Bar in London attracting affluent travelers through high-profile talent and tailored experiences.
Supply chain issues remain a systemic challenge, with Wendy's closures expected to impact both small and large suppliers. At the same time, new product launches, such as Remilk and Gad Dairies' cow-free milk, are entering the market, reflecting a growing demand for innovative and sustainable options.
Overall, the industry is seeing a mix of contraction and adaptation, with leaders focusing on efficiency, premiumization, and new consumer preferences to navigate ongoing disruptions.
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