Steak 'n Shake Permanently Closes 57 of Its Restaurants in the Wake of Coronavirus Pandemic
"The COVID-19 pandemic has adversely affected our operations and financial results," Steak n' Shake's parent company said in a report
The burger chain closed down 51 of its company-owned restaurants and six franchised outposts during the first quarter of 2020, according to a finance report released by Steak 'n Shake's parent company, Biglari Holdings.
In addition, the company sold one location to a franchisee and 10 stores to operating partners, the report said. As of March 31, the company now operates 306 Steak n' Shake restaurants — down from 368 at the end of 2019.
Most Steak n' Shake's dining rooms were closed by March 17 due to the coronavirus crisis and many of its locations had to pivot to operate under a takeout, drive-thru and delivery service model, the document stated.
"The COVID-19 pandemic has adversely affected our operations and financial results," the company said in its report. "However, the COVID-19 pandemic could cause disruptions to our supply chain. Moreover, we cannot predict how the outbreak of COVID-19 will alter the future demand of our products."
According to Biglari Holdings, which also owns steakhouse chain Western Sizzlin’, its restaurants lost $7.9 million during the first quarter.
Steak n' Shake had already been struggling in sales prior to the coronavirus outbreak, according to the company. Biglari Holdings founder and chairman Sardar Biglari said in an annual report released in February that the fast-food chain had a "dismal" performance in 2019 as it "was once again a drag on results."
"Steak n Shake prospered for eight years despite brutal competition," Biglari said in the report. "Over the past three years, however, results have gone from bad to worse."
Steak n' Shake was originally founded in 1934 in Normal, Illinois, and the first franchise location opened in 1939.
The chain was acquired by Biglari Holdings in August 2008.
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