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TheDailyMeal.com: Biggest Chain Restaurant Fails

Chi Chi’s

The first Chi-Chi's Mexican Restaurante opened in downtown Minneapolis in 1975 and was one of the breakout restaurants of the year, pulling in $2 million. Founders Marno McDermott and Max McGee’s creation had basically no competition in the Midwest, and by 1986 a whopping 237 locations had been opened, with 42 opening in 1985 alone. From there, unfortunately, it was all downhill. Attempts at expanding to New York City, New England, and the South failed, and increased competition combined with aging baby boomers and a decline in alcohol consumption spelled its doom. Locations fell to 144 by 2002, and a month after filing for bankruptcy in 2003 green onions served at a Pittsburgh-area outpost set off the largest hepatitis-A outbreak in American history, sickening 660 and killing at least four. The remaining 65 restaurants closed the following year, and today the brand only exists in the U.S. as a salsa brand owned by Hormel, which licensed their name. Oddly enough, there are 11 Chi-Chi’s still open in Europe, with eight in Belgium.

(Credit: flickr/ Tape )
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