Wendy's Expects to Close 100+ Restaurants This Year
From TGI Fridays to the bankrupt Tijuana Flats, a number of major restaurant chains have been shuttering locations this year due to lagging sales, rising costs, and other financial woes. Now, Wendy's has also joined the growing list of restaurant brands closing a significant number of stores in 2024.
The burger chain released its latest quarterly earnings results on May 2, reporting a 0.9% increase in global same-store sales and a 0.6% increase in the United States. During a subsequent earnings call with investors, Wendy's CFO Gunther Plosch announced that the chain plans to shutter a little over 100 restaurants in 2024.
Several of those closures already took place in the first quarter, which ended on March 31. The company reported 35 total new store openings during the quarter and eight net new store openings. This indicates that Wendy's shuttered 27 locations throughout the first three months of the year.
Plosch didn't offer much insight into why the chain is closing so many restaurants aside from saying "it's all with our rhythm in our business."
"Nothing unusual is happening here. Everything went to plan," he added.
Even though it will lose a large swath of locations in 2024, Wendy's still expects to end the year with a larger footprint than it had at the start. The chain anticipates opening 250 to 300 restaurants throughout the year, according to Plosch. These openings should add up to more than 2% of net new unit growth for the burger slinger.
When Eat This, Not That! contacted Wendy's for comment, a representative reiterated the chain's plans to close more than 100 stores and open 250 to 300 new locations in 2024. However, they did not address our queries regarding why and where the closures will take place.
Looking ahead, Wendy's wants to accelerate its new store openings by making restaurant operations more productive and efficient to increase profits.
"If we can expand margins by operating more efficiently, driving levels of productivity, those are meaningful partnerships that we are working on with our franchisees," CEO Kirk Tanner said. "That's something we're both in the boat, rowing together on, because we feel that will generate a lot of momentum for our future."
Wendy's currently operates more than 7,200 stores worldwide. The chain expects 30% of its future store openings to take place in the United States, while the other 70% will take place outside of the country, Tanner said.
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