Wendy’s plans to close about 300 of its 6,000 restaurants across the nation. Interim CEO Ken Cook said most of the stores that will be closed are the ones that are underperforming.
“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, per USA Today. “The goal is to address and fix those restaurants.”
The company expects to bring more resources to the remaining stores as it closes the underperforming locations.
“These actions will strengthen the system and enable franchisees to invest more capital and resources in their remaining restaurants,” Cook said, per CNN. “Closures of underperforming units are expected to boost sales and profitability at nearby locations.”
The latest announcement comes after Wendy’s closed down 140 underperforming stores. While the company now plans to close 200 to 350 restaurants, it’s not clear which specific locations will be shut down.
What does the latest report show about Wendy’s sales?
The latest quarter report shows that Wendy’s sales have declined 4.7%. Meanwhile, some of the company’s rivals, including McDonald’s, Burger King and Shake Shack, recently reported positive earnings.
Still, Cook said the company is seeing positive results after releasing its chicken tenders known as “Tendys.” The interim CEO said the Tendys were sold out in some restaurants.
“We’re looking forward to continuing that momentum, and this is an encouraging first step as we look to reestablish our leadership position in chicken,” Cook said, per CNN.
When does Wendy’s plan to close its stores?
Wendy’s expects to start closing some of its stores in the final quarter of this year. While some of the stores will be closed down for good, others will be transformed with the installation of new technology and new equipment.