7 Fast Food Chains Struggling as Sales Drop and Closures Mount

Food prices have gone up over the past year, which has made everything more expensive – including fast food. As a result, more people are eating at home than ever, which has caused sales at many popular QSRs (quick service restaurants) to plummet. Some have started offering more extra-value meals and slashing prices where they can, but others can't seem to get out of the decline. "This is a challenging situation for the QSR market. I don't think anybody's going to be out of trouble anytime soon, but they're doing something that seems to be working to at least stop the deceleration in traffic," Danilo Gargiulo, senior analyst at Bernstein, told Reuters. Here are seven fast-food chains struggling to survive.

eeges

eeges, a Southern Arizona staple since 1971, shuttered five restaurants and filed for Ch. 11 bankruptcy in December. While 20 other locations are still operating in the Tuscon and Phoenix areas, the future of the chain, specializing in sub sandwiches and their trademark slushie drink, is up in the air. Customers claim that everything went downhill after the company was sold to 39 North Capital, an investment firm. "It's been a staple of Tucson for years," eegee's fan Lance Dahlstrom told 13 News. "Ever since they sold it, the original owner sold it, it's gotten more expensive and less quality." Per a lawsuit filed in Maricopa County in October, the company owes restaurant supplier Sysco over $1.2 million. Bankruptcy documents also show that eegee's owes $725,000 to another vendor Merit, $410,000 to Ramp Flex, and $100,000 to Punchh, Inc.

KFC

In November, Reuters, KFC's same-store sales in the U.S. dropped 5% in the quarter ending on September 30, marking the chain's third straight quarter of declines in 2024. The fried chicken joint owned by Yum Brands, which also owns Pizza Hut and Taco Bell, saw worldwide same-store sales decline 2%. "Our sales didn't meet expectations in a few key markets, including China and the Middle East, where we have outsized exposure, and as a result, we tempered our expectations in the fourth quarter," they said in one phone call about the decline.

Burger King

Per the same Reuters report Burger King's U.S. sales declined 0.4% in the quarter ended September 30, compared with a 6.6% rise last year. The company attributes it to "soft demand" in France and "weakness" in China and the Middle East. While they tried to reduce prices, Restaurant Brands CEO Joshua Kobza maintains that aggressive sector-wide promotions made it difficult for their Fiery menu option "to cut through all the value messages in the market."

Papa John's

Papa John's was hit hard in 2024, suffering an overall 3% decline in revenue, with stores open for at least a year experiencing a 6% reduction in sales, per Restaurant Business. According to the company, North American same-store sales fell 6% in North America in the third quarter, marking its third straight quarterly decline and the worst since the second quarter of 2019. "We are acting with urgency," CEO Todd Penegor said in November "We are laser-focused on strengthening our foundation in the near-term, while positioning the company to capitalize on opportunities to drive success and value creation over the long-term." The company blames "value perception," noting it as a major challenge. "We need to make sure we are back in the consideration set first and foremost to be competitive on price."

Popeyes

Popeyes U.S. comparable sales were down by 3.8% while net restaurant growth was up 3.6%, and systemwide sales decreased 0.8% during the third quarter, Restaurant Brands International CEO Josh Kobza revealed during an earnings call in November. According to Kobza, the decline was a result of the lack of value menu items. "We've reoriented our marketing strategy to better align with the needs of consumers today, while reminding guests what makes Popeyes so special," he said, per Restaurant Dive. "We know we need to provide better value, which we can deliver through better price points and a better experience." Last year, Popeyes added a three-piece chicken offer for $5 and a $6 Big Box, both of which drove sales, he added.

BurgerFi

After months of reporting a financial decline, BurgerFi, the parent company of Anthony's Coal Fired Pizza, filed for Chapter 11 bankruptcy in September, according to a report. "BurgerFi and Anthony's Coal Fired Pizza & Wings are dynamic and beloved brands, and in the face of a drastic decline in post-pandemic consumer spending amidst sustained inflation and increasing food and labor costs, we need to stabilize the business in a structured process," said Jeremy Rosenthal, Chief Restructuring Officer of BurgerFi International, Inc. "We are confident that this process will allow us to protect and grow our brands and to continue the operational turnaround started less than 12 months ago and secure additional capital."

Firehouse Subs

Firehouse Subs, the most recent acquisition by Restaurant Brands, experienced one of the largest dips in sales. Same-store sales declined 4.8% in Q3 of 2024. The sub shop was founded by former firefighter brothers in 1994 and operates 1,210 restaurants in 46 states, Puerto Rico, Switzerland, Mexico, and Canada.