The majority of Chiquito restaurants are to close permanently after the owner of the chain said the coronavirus crisis had prompted it to call in administrators.
The Restaurant Group, which also owns Wagamama and Frankie & Benny’s, said 61 out of 80 branches of the Tex-Mex dining chain would not reopen. It also said it would permanently close its 11 Food and Fuel pubs in London. The decision will lead to the loss of almost 1,500 jobs.
A spokesperson for The Restaurant Group said that it expected the two chains to make a loss during 2020, and stated that “Covid-19 has had an immediate and significant impact on trading across the group”.
The Restaurant Group said it had initially kept Chiquito and Food & Fuel workers in employment after the government ordered all restaurants to close to help prevent the spread of coronavirus, and while it awaited details of the government’s scheme under which it will pay 80% of workers’ wages.
Along with other restaurants in the casual dining sector, the Chiquito chain had been struggling with falling sales and profits. Customers have turned their backs on mid-market restaurant chains over the last two years, leading to the collapse of brands such as Byron, Gourmet Burger Kitchen and much of Jamie Oliver’s restaurant empire.
Last September, The Restaurant Group announced it would close several branches of Chiquito as their leases expired or they reached a contractural break period.
The group gave a profits warning and sounded the alarm over falling sales earlier in March, when it announced plans to cut costs, halve capital expenditure, speak to its lenders and negotiate with landlords about rent reductions.
The latest closures account for around 10% of The Restaurant Group’s 650 sites.
Around 20 Chiquito sites, and some of the group’s other brands such as Ribble Valley Inns, are not affected, and are scheduled to reopen when the government-ordered shutdown ends.
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