Dive Brief:
- Dine Brands, parent of Applebee’s, IHOP and Fuzzy’s Taco Shop, has laid off about 9% of its staff across different departments, brand teams and offices. The move is part of a “strategic plan to better align with current market conditions,” Christie Cook, vice president of human resources at Dine Brands, wrote in an emailed statement.
- As of the end of 2023, the company had 596 employees, according to Dine’s most recent 10-K filed with the U.S. Securities and Exchange Commission. If that headcount remained steady over 2024, the recent layoffs likely impacted about 50 people.
- Dine Brands is the latest of a slew of restaurant companies to announce layoffs. Most recently, Starbucks CEO Brian Niccol hinted that support staff reductions will start in March.
Dive Insight:
Dine is still feeling the sting of customers pulling back from discretionary spending. Lower-income diners are increasingly choosing to eat at home, Dine Brands CEO John Peyton said during a November earnings call.
For the first three quarters of 2024, Dine Brands faced declining revenue, largely due to negative comparable sales across its brands, according to an earnings release. Year-to-date comps were down for Applebee’s (-4.1%), IHOP (-1.7%) and Fuzzy’s (-8.9%) at the end of Q3.
Dine has been focused on multi-faceted company improvements. Value messaging, menu innovation, boosting its store count — including the potential development of dual-branded IHOP-Applebee’s units— and diversifying its franchisee base are all top priorities. Peyton said its brands also have potential to improve its off-premise business, which remains about 20% of sales for both IHOP and Applebee’s.
“We remain focused on our long-term vision driving sustainable growth and success. We are grateful for the dedication and hard work of our team members and will continue to prioritize their well-being,” Cook said.
Impacted team members will receive severance packages, outplacement services and other support, Cook said, adding that “this decision was not made lightly, we deeply value the contributions of all our team members and are committed to supporting those affected during this transition.”
Many restaurant brands have recently turned to job cuts to right their businesses.Duck Donuts undertook layoffs last month, coinciding with CEO Betsy Hamm’s resignation. Panera Bread also cut a number of corporate employees last year, as did Noodles & Company. In September, Pinstripes announced plans for reductions.
