A beloved Crown Heights seafood spot is fighting to stay afloat. After 12 years in business, the owners of Krabby Shack say a combination of rising third-party delivery fees and fewer customers walking through their doors could force them to close, a warning that places the restaurant among a growing number of small businesses under pressure across Brooklyn.
According to the owners, the squeeze is coming from two directions at once. On one side are the third-party delivery fees that take a cut of every online order, and on the other is a drop in the number of customers coming in off the block to buy fresh seafood in person. Together, those two pressures have left the business struggling to keep going after more than a decade in the neighborhood.
The delivery side of the business has become especially difficult for restaurants like Krabby Shack. The National Restaurant Association says profit margins on delivery orders have shrunk by an average of 15% since 2020, meaning that each order placed through a delivery service now returns less to the restaurant than it once did, even as the fees attached to those orders continue to weigh on small operators.
Krabby Shack is not alone in feeling the strain. Small businesses have continued to close across Brooklyn, a wider trend that has left customers worried about losing the independent neighborhood spots they count on. For many residents, the prospect of another familiar storefront going dark has become a recurring source of concern in the borough.
For the people who live nearby, the possibility of losing Krabby Shack has been hard to accept. One customer said it would be very disappointing, explaining that locals come by all the time because they know that any time they walk down the block they can get fresh seafood, and adding that they hoped the restaurant would not have to go out of business.
Despite the uncertainty, the owners are looking for a way to keep the business alive. Krabby Shack is set to celebrate its 12th anniversary on August 8, and its owners say they hope to use the occasion to bring the community together and keep their doors open, turning the milestone into a rallying point for the neighborhood that has supported them for more than a decade.