Last summer, under Thai Union, Red Lobster turned $20 endless shrimp into a permanent item on the menu for the first time, instead of its traditional limited-time offer deal. The change cost the company $11 million and cut into Thai Union profit. In its bankruptcy filing, Red Lobster said it is investigating the circumstances of that promotion, which the company’s management opposed.
And then later…
But the company in its bankruptcy filing blamed Thai Union for the losses. Noting that under the guise of a “quality review,” Red Lobster eliminated two of its breaded shrimp suppliers, leaving Thai Union with an exclusive deal. That led to higher costs for the restaurant chain, and did not comply with the company’s typical decision-making process for picking suppliers based on projected demand.
Sounds like Red Lobster got juiced. I’ve never eaten there, but this is some evil stuff.
The Thai Union owns 49% of the stock. That shouldn’t be enough to control the company, but the fact that “none” of the C suite agreed with getting rid of the other suppliers but it happened anyway?
Maybe. Perhaps Thai Union was going for vertical integration and wanted to have control of the fried shrimp lifecycle all the way to your mouth, but bit off more than they could chew.
So apparently there’s foul play.
From this article;
And then later…
Sounds like Red Lobster got juiced. I’ve never eaten there, but this is some evil stuff.
How is their shrimp supplier determining what promotions they run and when?
yeah that part confused me too. is a supplier an owner too?
The Thai Union owns 49% of the stock. That shouldn’t be enough to control the company, but the fact that “none” of the C suite agreed with getting rid of the other suppliers but it happened anyway?
Maybe. Perhaps Thai Union was going for vertical integration and wanted to have control of the fried shrimp lifecycle all the way to your mouth, but bit off more than they could chew.