The restaurant industry has faced its share of challenges in recent years. Higher food costs have put pressure on restaurants, tightening already narrow margins.
Increased labor costs have also been an issue for restaurants. In 2024, 25 states raised their minimum wage, forcing restaurants to pay up.
The combination of higher costs and changing consumer behavior has hurt a number of well-known chains. Consumers are spending less at restaurants because they are financially strained.
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As it is, 70% of Americans are struggling to afford groceries, according to a late 2024 survey by Swiftly. When money gets tight, luxuries like dining out often have to go.
Restaurant prices have also increased more than grocery prices over the past year. In February, restaurant prices rose 3.7% on an annual basis, according to the Consumer Price Index, compared to a 1.9% annual increase for groceries.
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Many restaurants are being driven into bankruptcy
Casual restaurant chains have been hit hard by recent economic events. And many have had no choice but to file for bankruptcy.
Red Lobster filed for Chapter 11 in May 2024, citing financial and operational challenges. TGI Fridays filed for bankruptcy in November of 2024. The popular chain said it had been hurting ever since the pandemic.
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A number of well-known Mexican casual chains have also filed for bankruptcy or announced closures. Rubio’s Coastal Grill filed for Chapter 11 mid-2024 to restructure its debt and close 48 California locations. On The Border Mexican Grill & Cantina filed for bankruptcy in March 2025 after closing 40 locations.
Some restaurants have changed their menus following bankruptcy proceedings in an effort to attract new customers and entice existing ones.
Tijuana Flats launched a major menu makeover after its bankruptcy filing, introducing more authentic flavors and new additions to its beverage lineup.
Menu changes are an equally smart strategy for restaurants that may not be on the verge of bankruptcy but want to improve their bottom line at a time when customers are spending their money more carefully and dining out less frequently.
Cheesecake Factory overhauls its menu
Cheesecake Factory fans tend to appreciate its extensive menu that practically reads like a book. In addition to a few dozen cheesecake varieties, the menu features pages of appetizers, entrees, and a robust selection of drinks.
But when consumers aren’t rushing to dine out, restaurants need to innovate continuously. Cheesecake Factory is doing its part to remain competitive by overhauling its menu—something the brand aims to do twice a year.
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Part of that process means eliminating menu items that haven’t been top performers. Cheesecake Factory fans will have to say goodbye to these favorites:
- Everything Flatbread Pizza
- Mushroom Burger
- Seared Ahi Tuna Salad
- White Chicken Chili
- Spicy Cashew Chicken
- Bistro Shrimp Pasta
- Fried Shrimp Platter
- Petite Filet
- Factory Combinations
- Loaded Mashed Potato Omelette
- Taco Dorados and Eggs
- SkinnyLicious Lemon Herb Paramzan Chicken
- SkinnyLicious Spicy Shrimp Pasta
But the news isn’t all bad. Cheesecake Factor is also adding 22 new items, including Chicken Shawarma, Double Smash Cheeseburger, and Spicy Ginger Beef Tenderloin, among other entrees.
The chain’s beverage lineup is also getting some new additions, including a Margarita Verde, Japanese Whisky Sour, and Yuzu Crush. And a strawberry shortcake dessert for kids is joining the restaurant’s already impressive lineup.
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“We’ve always said there’s nothing that we can’t put on our menu that America might want,” CEO David Overton said during the company’s February earnings call. “And the overall experience of dining at Cheesecake is a large part of the value proposition that people are looking for today.”
The menu update targets a variety of price points—a strategic move at a time when consumers aren’t rushing to spend their paychecks. The new price points range from $12.95 for an appetizer to $31 for a steak dish.
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