49-year-old pub chain closed over 250 restaurants, only 21 left

Sometimes success can cause its own problems.

A community might be able to support one or two of a certain kind of business, but when one company has success, it's natural for copycat brands to enter the space. There's only so much new demand that can be created, and at some point, oversaturation can cause multiple businesses to fail.

In some ways, that's what going on with Uber and Lyft. Although both companies provide a needed service, their pricing is constrained not just by the cost of cabs and car services, but also by each other's existence.

If Uber charges more than Lyft, a certain amount of customers simply use the other brand. It's a vicious cycle that often ends in both companies merging or going out of business.

Too much competition can drive restaurants out of business, and that's part of what pushed Bennigan's, a once-thriving chain, to the brink of extinction.

Bennigan's had too much competition

Back in the early 2000s, Bennigan's an American take on an Irish pub was a fast-growing chain that reached over 300 restaurants. The company collapsed, however, because of market conditions somewhat beyond its control.

"These restaurants share many subtle and complex challenges that extend beyond this difficult economic climate," thenTechnomic President Ron Paul told MarketWatch Money Morning. "To some extent, they've become victims of their own success — a mature category with too many units and not enough differentiation, at least in the eyes of consumers."

With so many similar choices in the casual dining restaurant market, consumers have little incentive to choose Bennigan's over similar competitors such as TGI Fridays or Ruby Tuesday Inc., the website shared.

"All these bar and grill concepts are very, very similar," former Technomic Executive Vice President Bob Goldintold The New York Times, according to Kiplinger. "They have the same kind of menu, décor, appeal," making it more difficult to establish brand loyalty among customers.

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Bennigan's was a quick success story, but its collapse and near death was sudden as well.

"Known for its happy hours more than its food, the chain's sudden near-collapse in 2008 was epic: Its owner filed for Chapter 7 liquidation, shuttering the 150 corporate-owned restaurants overnight (more than 100 franchises survived), as well as all of the Steak and Ale restaurants. Two years earlier, it had closed all of its New York state and Connecticut locations," the magazine reported.

A timeline of Bennigan's downfall

• Bennigan’s was founded in 1976 (first location in Atlanta, Georgia).
• At its peak, Bennigan’s “had over 300 restaurants.”
• In 2008, when its parent company filed for bankruptcy (Chapter 7), Bennigan’s closed all 150 corporate‑owned locations almost immediately.
  Source: Kiplinger
• At that time, there remained a number of franchise‑owned Bennigan’s — but many of those locations gradually shut down over subsequent years.
  Source: Mashed
• By the early 2010s, as the chain attempted a revival under new ownership, Bennigan’s had already dropped to only a few dozen locations.
  Source: Restaurant News Resource
• Over time, additional closures kept reducing the number of surviving restaurants.
• In 2015, a new owner (through Legendary Restaurant Brands, LLC) acquired Bennigan’s and its sister chain (Steak and Ale), aiming to resurrect the brand.
• The revival included not only trying to re‑establish dine‑in restaurants but also launching a “fast‑casual/limited‑menu” concept called Bennigan's On The Fly, a version designed for nontraditional venues (casinos, airports, ghost kitchens, food halls, etc.).
• Current counts include 21 full “brick‑and‑mortar” Bennigan’s restaurants, plus 21 Bennigan’s On The Fly units.
  Source: Bennigans.com

Bennigan's tries for a comeback

While more than 275 classic Bennigan's locations have closed, Legendary Restaurant Brands has plans for a comeback. That comeback, however, won't necessarily be focused on the United States.

"Bennigan’s, the iconic American brand known for its Legendary food, warm hospitality, and globally recognized franchise model, is preparing for a significant wave of expansion throughout the Gulf Cooperation Council (GCC). This strategic growth includes a major commitment to open multiple Bennigan’s and Bennigan’s On The Fly locations in Qatar over the next several years through its long-standing partnership with Almuftah Sterling Restaurant Group," the company shared in a Nov. 20 press release.

Taste of Country noted that Bennigan's was poised for a comeback in an October article.

"New ownership is modernizing the menu, bringing back signature décor, and leaning into 'experiential dining,' creating casual, communal meals that feel familiar and fun. A handful of locations have already reopened in urban and suburban areas, and the laid-back vibe is just like fans remember," the website reported.

Legendary Restaurants is actively looking for new franchise operators.

“With a renewed focus on improving the business climate and easing regulations, these franchise formats — full-service, hybrid, and casual steakhouse — ensure adaptability,” said CEO Paul Mangiamele in a press release. “By offering proven business models, we’re empowering franchisees to realize their personal vision of the American Dream."

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