One of the popular food chains in Florida, Steak 'n Shake has permanently closed 57 restaurants in the country as the company is facing major loss due to coronavirus lockdown. The parent company is said to have incurred heavy financial losses due to COVID-19 pandemic in the first quarter of this year and decided to permanently lock 57 of its outlets in Florida.
Steak 'n Shake owned by Biglari Holdings Inc made the announcement that when compared to last year's revenue (for the first quarter), this year it has suffered a loss of $59 million as there were only a handful of takeouts, drive-thru and delivery orders after the lockdown was declared.
The pandemic loss
Out of the 57 outlets that have been closed, 51 were owned by the company, whereas six were being run by the franchise. Steak 'n Shake had a total of 624 outlets in the country in 2019 but the number was reduced to 553 at the beginning of 2020. Out of these including 414 corporate operations including 306 company-owned outlets and 214 franchised establishments.
On March 31 after the lockdown was declared, 62 restaurants were temporarily closed due to limited orders. Even before the pandemic broke in the US, Steak 'n' Shake had closed nearly over 100 restaurants last year between January and August.
History of Steak 'n Shake
Steak 'n Shake was established by Gus Belt in February 1934 in Normal, Illinois. The outlet was initially known for selling premium burgers and milkshakes. The name Steak stood for Steakburger and shake referred to milkshakes. Steak 'n Shake is a subsidiary of Biglari Holdings Inc and is in business for 85 years.
The original building at the intersection of Main Street and West Virginia Avenue was gutted in 1960 in an accident fire resulting in a major repair and expansion of dining room. The building was later sold to Monical's Pizza company in the 1990s.
Meanwhile, after the death of founder Gus Belt in 1954 Steak 'n Shake was owned by Gus' wife Edith till 1969. The company went into the hands of Longchamps, Inc, an East Coast steakhouse company till 1971. Then in 1971, the company was brought by Indianapolis-based Franklin Corporation, led by Robert Cronin who was the author of Selling Steakburgers: The Growth of a Corporate Culture. He moved the headquarters from Illinois to Indianapolis. In 1981 Steak 'n Shake was acquired by EW Kelley and Associates.
The current owner Sardar Biglari took over Steak 'n Shake in August 2008. But the company ran into financial problems in 2016 and their outlets have been reducing in phases from then on.