O’Charley’s Closes 18 Restaurants in a Bold Restructuring Move

O’Charley’s, a prominent casual dining chain, has recently undertaken a significant restructuring by closing 18 of its restaurants.

This decision, a part of a larger strategy to address economic challenges, marks a pivotal moment for the company.

The Impact of Economic Challenges

O’Charley’s decision to close these restaurants comes as a response to various economic pressures.

The Nashville, Tenn.-based company has been grappling with the effects of post-COVID inflation, especially commodities inflation, which has squeezed margins significantly.

The closures represent about 17% of its total portfolio, indicating a considerable scale back for the 50-year-old chain.

A Strategy for Long-term Health

Craig Barber, CEO of O’Charley’s, emphasized that this move was necessary for the long-term health of the brand.

Despite the affection and loyalty of its customers, the economic realities dictated that the chain could no longer sustain stores that were not producing adequate cash flow.

The company is now focusing on a more asset-light portfolio, aiming to preserve cash flow and rejuvenate the brand.

Refocusing and Adapting

Part of O’Charley’s strategy involves smart pricing and discounting. They reintroduced the “Free Pie Wednesday” deal, now with the requirement of purchasing an adult-sized entrée.

This approach reflects a careful balance between attracting customers and maintaining profitability.

Additionally, they are focusing on promotional strategies and outside partnerships to improve traffic, especially on slower business days.

The closure of these 18 restaurants, while a challenging decision, is seen as a necessary step by O’Charley’s to navigate through the current economic landscape and position itself for future success​

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