Dive Brief:

• Rubio’s Coastal Grill closed 48 underperforming locations in California as of Friday, a company spokesperson wrote in an email to Restaurant Dive.
• The decision followed a “thorough review of its operations and the current business climate,” the spokesperson said. “While painful, the store closures are a necessary step in our strategic long-term plan to position Rubio’s for success for years to come.”
• The closures were brought about by the increased cost of doing business in the Golden State, the spokesperson said.

Dive Insight:

Rubio’s is among the first regional restaurant chains to close a high number of stores following California’s implementation of the $20 minimum wage for fast food chains with 60 or more units. Mod Pizza closed 27 stores nationwide earlier this year, but only five were in California. Others brands, including Chipotle, Domino’s, Shake Shack and Portillo’s, have increased prices and are looking at labor-saving technology like kiosks in reaction to the state’s increased labor costs. 

Rubio’s store count is now 86 stores across California, Arizona and Nevada. Last year, it underwent a rebrand with “A Taste of Baja” brand positioning to better capture the “laid back, beachy Baja lifestyle.” That branding included new signage, refreshed store decor and packaging. It also offered several shrimp dishes as part of an LTO. 

As of 2023, the company’s sales were $220 million, according to Technomic estimates posted on Restaurant Business. The Mexican chain declared bankruptcy in 2020 due to the impact of COVID, leaving it with 150 stores, but hasn’t added many stores since then. Prior to its latest round of closures, Rubio’s had 134 stores.