Red Lobster’s new CEO says the seafood chain’s endless supply of shrimp has caused all-you-can-eat chaos

But in August, Red Lobster got a new CEO: Damola Adamolekun, the 35-year-old former chief executive of PF Chang. Adamolekun is on a mission to revive the 56-year-old restaurant chain after it was rocked by the shellfish chaos of the past two years.

“This is, without exaggeration, one of the most important companies in American history,” Adamolekun said CNN. “There have certainly been big mistakes made in recent years.”

One of the major missteps Adamolekun refers to was the endless promotion of Red Lobster shrimp. It was wildly popular with diners, but it was far too expensive for the restaurant chain — which suffered millions in operating losses — and put undue stress on servers and kitchen staff, Adamolekun said.

Shrimp is “a very expensive product to supply indefinitely,” he said in CNN interview. “When you have endless shrimp and people come and sit at the table and eat as many shrimp as they can for hours, you stress the kitchen. You’re stressing the servers. You stress the host. People can’t get a meal. It creates a lot of chaos.”

The “Ultimate Endless Shrimp” deal was launched in June 2023, and diners could choose from two types of unlimited shrimp dishes for $20. The deal, which stopped at the end of 2023, also included the chain’s famous Cheddar Bay biscuits. It was previously a limited-time affair, but the restaurant’s attempt to make it a permanent menu option ultimately saw the company’s downfall. It resulted in an $11 million loss, and its restructuring team blamed it as a direct contributor to the bankruptcy filing in May.

“We wanted to increase our traffic and it didn’t work,” Thai Union Group chief financial officer Ludovic Regis Henri Garnier told investors.. “We have to be much more careful about the entry points and what the price point is that we’re offering for this promotion.” Thai Union Group is Red Lobster’s investor in Thailand and expects to divest completely by the end of the year.

Thiraphong Chansiri, managing director of Thai Union Group, however, pointed to other factors affecting the seafood chain.

“The combination of the COVID-19 pandemic, sustained industry headwinds, higher interest rates and rising material and labor costs have impacted Red Lobster, resulting in prolonged negative financial contributions to Thai Union and its shareholders,” he said. Chansiri said in a statement in January.

The CEO’s vision for Red Lobster

While dozens of Red Lobster locations have closed in 2023, Adamolekun said CNN his plan is to grow the company — but not necessarily by opening or reopening locations.

“We intend to close the restaurants,” he said CNN. “We intend to grow the business from here. There will be product investments that will take time. Investing in infrastructure takes time. Investing in technology takes time.”

There are currently 545 Red Lobster locations, and Adamolekun said the company plans to improve each one by fixing broken HVAC systems, torn carpets and seats.

“It will take time, but the impact should be felt immediately,” he said. Adamolekun also said the company plans to pare down its menu in a “very smart way” because the offerings were too plentiful.

Adamolekun got a head start on his vision for the restaurant by secretly visiting restaurants around the country before taking the company’s top job and sampling crab legs and lobster tails. He did this as a means to connect with and understand his brand and customers.

Customers “just want quality food in a comfortable setting and to connect with the history of the brand,” he said WSJ. “This is the first step.”