Fast-food giant Wendy’s is closing 140 underperforming locations by the end of 2024. Management wants to improve its “restaurant footprint and overall system health.”
Replacement
To counteract the closures, the management is working to replace many of these locations with “new restaurants at better locations with significantly improved sales and profitability,” Wendy’s CEO Kirk Tanner told analysts.
The company thoroughly reviewed individual restaurants to ensure they meet sales expectations and are profitable enough to support growth. They then announced that the locations closing are “outdated and in underperforming areas,” with operating margins far below the system average, Tanner said.
Reasoning
Tanner went on to say,
I think when you think about strengthening our system, you look at a brand that’s 55 years old and some of those restaurants are just out of date [1].
This restaurant optimization is part of a list of initiatives Wendy’s is deploying to strengthen its brand and operations across the company and its franchisees. To offset the closings, Wendy’s plans to open between 250 and 300 restaurants this year.
The company didn’t disclose where the closures will be, but Tanner did note that they will not be in one particular area. And Wend’s is a worldwide restaurant.
Notes:
- ^ {Wendy’s to close 140 restaurants by the end of the year} (go back ↩)
