A BOOM and a BUST: Harry & David & Hooters

Openings, expansions, and bankruptcies are standard fare in the MULO (multi-location) retail and restaurant space. This month, we saw one significant opening and one bankruptcy declaration in the MULO ecosystem. Harry & David recently announced they are getting back into the retail game. This 91-year-old seller of gift baskets and gourmet food items shuttered most of its stores during the pandemic. Part of the 1-800-FLOWERS.COM family, they were able to weather the retail storm. After all, a fresh pear is timeless.

Speaking of fresh pairs, another MULO brand was not quite as fortunate in its business history. HOOTERS, known for its busty and scantily clad servers, declared Chapter 11 bankruptcy at the end of March and is working out its $376 million debt through a founder-led buyout and restructuring. They will keep their locations open while they go through that process.

What can we glean from these announcements?

As we’ve written previously, openings, brand growth, and closings can reflect the tastes and habits of shoppers and diners or be a function of flawed management decisions.

Harry & David has a long and relatively uncontroversial history as a purveyor of fresh fruit and gifts. As long as we have birthdays, funerals, promotions, and other “life moments,” gift baskets run little risk of obsolescence. Although many other brands (some online-only) have emerged in the personalized gifting category, a combination of consistency, reliability, and service has certainly helped Harry & David.

In addition, being part of 1-800-FLOWERS.com has given the gift brand an advantage, as they were able to weather the pandemic storm via digital business.

Restaurants were not as fortunate during the pandemic. Although home delivery became wildly popular, those restaurants known as “experience brands” could easily fall behind. Additionally, the HOOTERS name has very specific connotations (no judgment), and as a result, the 420-location establishment has a limited target.

Part of their “rebirth” involves investing in more charity work and focusing on family-friendly food items. The company dubbed this rebrand “Re-Hooterization.” Among other initiatives, it involves eliminating “Bikini Nights.” The brand was founded in 1983 and has an owl as its logo. So, perhaps having the nocturnal animal represent something other than beer and wings, TVs, and skimpy server uniforms is in the offing. It would be a huge marketing pivot, indeed!

So, we will continue to enjoy our fresh fruits and nuts while we await the long-term outcome of the Hooters bankruptcy. Owls are supposed to be wise, after all!