Restaurant chains with a bulk of their locations in malls and retail centers are bracing for a holiday shopping season that is expected to bring fewer potential customers past their doors.
Many restaurant chains have some units in malls, whether in the food court, elsewhere in the mall or as freestanding locations in the parking lot. However, some have a greater percentage of their stores in malls than others, and thus are more susceptible to traffic declines, especially during the all-important holiday shopping season.
Among those are California Pizza Kitchen Inc., which has about 89% of its 251 restaurants in or near retail centers and malls, and Cheesecake Factory Inc., with two-thirds of its stores in or near shopping centers. Most Red Robin Gourmet Burgers Inc. restaurants are also tied to retail centers, while Kona Grill Inc.'s 20 restaurants are also primarily within shopping centers. P.F. Chang's China Bistro Inc. and Ruby Tuesday Inc. are also exposed to downturns in retail traffic, analysts say.
"These aren't necessarily brands you make a reservation to," Oppenheimer & Co. restaurant analyst Matthew DiFrisco said. "They live off the flow of traffic going to lifestyle centers and malls, and are trying to intercept you while you're out shopping."