Wendy's Evaluates Underperforming Restaurants to Boost Sales
The fast-food burger chain Wendy's is closely reviewing its weakest locations as part of an effort to reverse a recent sales decline. The company is collaborating with franchisees to either improve, sell, or close struggling restaurants.
Strategies for Underperforming Locations
Speaking to investors, executives from the Dublin, Ohio-based chain outlined a range of options for weaker restaurants:
- Investing in assets, service, and operational improvements
- Transferring ownership to other franchisees
- Closing some stores, potentially starting this year
Planned Closures and Impact
Ken Cook, Wendy’s interim CEO, indicated that a "mid-single-digit percentage" of U.S. restaurants could close following this review. With just under 6,000 locations nationwide, this suggests fewer than 300 closures.
"When we look at the system today, we have some restaurants that do not elevate the brand and are a drag from a franchisee financial performance perspective," Cook said. "The goal is to address and fix those restaurants. So in some cases that’s going to mean deploying operational improvements, deploying additional technology or equipment."
Focus on Service and Growth
Wendy’s shift prioritizes enhancing service quality and increasing sales volume per unit, aiming to strengthen the overall brand and franchisee success.
Summary: Wendy's plans to improve sales by working with franchisees to fix or close underperforming restaurants, potentially closing up to 300 locations while focusing on service and operational upgrades.