A common thread among all these is any restaurant chain that was acquired by private equity; the private equity firm comes in, reduces costs by lowering quality and service, and then strips all the value out.
Private equity is the absolute fucking worst. Everything they touch turns to shit, they run it into the ground with unmanageable debt, bankrupt the company, and move on. They've ruined so many good restaurants and all in the name of endless profits. It's such a shame.
Still not sure why private equity is legal but regular grifting isn't.
The romance scam where the grifter finds some lonely old person, pretends to like them and steals their money/takes out loans in the victim's name and then disappears is indistinguishable from what PE does.
Well, not exactly. Private equity in the modern sense was illegal until various reforms over the 70s and 80s. It used to be that businesses had an obligation to care about their employees and their customers, and society as a whole, in addition to their shareholders. It used to be that it was a breach of good faith to intentionally make your product worse. But then two major changes happened. The Courts ruled that businesses had a duty ONLY to shareholders and that duty was only measured in the value of their shares at any particular moment. In other words, if a business has to choice between keeping share prices even but maintaining quality or raising sharepriced by $1 but then dismantling the business, they can and will be sued by shareholders if they don't take the second option.
This is a simplification of the various changes, but that's the core of it. A business used to have to care about its future and it's quality. Now it only cares about the next shareholder meeting and nothing else matters. That change is bad for everyone except venture capitalists, so theres actually no hope of changing it.
Can you cite the law and/or cases you’re referring to? Not doubting you, but I am curious how you can legally force a business to maintain their product quality. Seems like the polar opposite of a free market.
I understand the sentiment. But my personal advice would be you don’t have to comment on every topic if you don’t really have anything to add beyond venting frustration. I see you don’t understand what PE is, how it works, etc. I’m not defending PE, I’m trying to point out how dialogue on reddit can be improved. Let someone who actually knows something comment instead of people having to navigate how many comments of people who like to hear their own voice.
People only know all of the bad PE stories. No one ever talks about how PE saved Dunkin, Dollar General, Dominos, Hilton, etc. They dont talk about the PE firms that own blue collar businesses that pay for apprenticeships for young adults out of high school, or the fact that many firms employ a lot of people through their portfolio companies.
Is it all rainbows and sunshine? no. But it aint all gloom and doom either.
The thing that sucks is they all go after food quality and ingredients. Raise the prices. Cut some staff and make people wait longer. But leave the taste alone. Give me one Reeses Cup in a package but keep it tasting like a Reeses Cup.
Because the previous owners of the company get a fat paycheck when they sell.
Like, it's the difference between you buying my house for market value to tear it down, and you just tearing down my house without my permission. One's fine, one's super illegal, but it's my consent to sell the house that makes the difference.
I can still get good food at the one near me, but I can tell they’re on their way down. When they asked me if I was a rewards member I was like oh fuck you.
I asked about this in another thread and adding to it the people who work in private equity don't go to any of these places as customers; they have private chefs and planes and people kissing their asses all day long, they see these places as stones to squeeze blood from, not actual places actual humans like.
If you work in the corporate world and your company gets bought by a PE, immediately update your resume and start looking. It’s only a matter of months before layoffs, bonuses slashed, no raises, benefits cut, all execs replaced, doubling workload, etc. It happens 99% of the time.
Valid, but a $20 sub from our Jersey Mike's (Giant sized Club Supreme) will feed 2 people and still be much better quality and cheaper than 2 footlongs at Subway.
Yeah, not sure what this dude is eating there unless it’s a giant sub meant for 2 or more people. Their most expensive “regular” size sub where I am is just over $10
One opened right up the road a couple years ago. Their sandwiches are terrible. But it may be that location. Cause when I lived in another town that Jersey Mike's was great.
No real drop for my area. There's 3 in my area, and they're all still pretty good. Only downside is the one closest to me seems to have some issue with inventory management, because they're always out of the chips I want.
It’s definitely in process of enshitifying. The bread and amount of toppings has shrunk drastically. The last tuna sandwich I ordered had a thin coat of tuna for flavor only. Never again. Subway is somehow better now.
PE isn't even necessary. Nearly every chain that starts out great inevitably has to bring in the corporate bean counters to slash costs right up to the point that it impacts quality enough to affect profits in order to maximize profits and satisfy shareholders.
I mean a couple of them aren't. But privet equity getting involved in chain restaurants isn't really surprising, chain restaurant's main value proposition (consistent food across the country) isn't really as valued as it used to be so a lot of the brands that were weak are struggling, and that's were PE swoops in to buy up the failing brand.
A lot of these are publicly traded companies or owned by publicly traded companies. Private Equity does ruin the quality of almost everything it touches, but so does traditional corporate cost cutting over the long term. Which is what is actually happening in most of these cases
I suppose it’s implied by the first word in the descriptor, private equity, but it’d be interesting to know exactly who the individuals are behind the PE curtain. Who are the board members and investors draining these businesses dry out of pure insatiable greed.
They have no other goal than to use those stores as profit centers to funnel them money. They don't care about the quality, they don't care about the experience, they will beat that dead horse till it quits paying them. They have no long-term concerns.
1.1k
u/ABpro90 9h ago
A common thread among all these is any restaurant chain that was acquired by private equity; the private equity firm comes in, reduces costs by lowering quality and service, and then strips all the value out.