Following a similar closure trend to that of Denny’s and many other big name establishments this year, Wendy’s has announced the impending closure of 140 of its restaurants. The unexpected announcement came during the company’s November Q3 2024 earnings call in which Wendy’s president and CEO Kirk Tanner stated, “We want to further improve our restaurant footprint and overall system health.”
During the call, Tanner explained that his decision to close so many restaurants is one that is “strategic” in identifying “outdated and underperforming trade areas.” Tanner noted that these specific locations have “average unit volumes of approximately $1.1 million and operating margins well below the system average.”
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The overarching idea here is that Wendy’s will continue to open more storefronts in different regions in order to offset the upcoming store closures.
“We have designed this initiative to ensure that over time, many of these units will be replaced by new restaurants at better locations with significantly improved sales and profitability,” Tanner explained. “We anticipate that total closures in 2024, including additional closures in the fourth quarter, will be offset by new restaurant openings this year, leaving our net unit growth approximately flat compared to the prior year.”
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Aside from the storefronts that are designated to be shuttered, Wendy’s has actually been experiencing a positive growth trend as of recently. The popular fast food restaurant introduced a brand new breakfast menu, a number of seasonal Frosty creations and a whole new line of saucy chicken nuggets. And despite the 140 scheduled store closures, Wendy’s has continued to open new locations globally to this day.
Related: This Popular Burger Joint Has Been Forced to Close More Locations—Here’s What’s Happening
“We opened 64 new Wendy’s restaurants globally during the third quarter and remain on track to meet our goal of 250 to 300 openings for the full year,” Tanner said. A spokesperson with Wendy’s further explained that the “Wendy’s system is incredibly healthy, and we remain on track to meet our goal of 250-300 new restaurant openings for the year.”
The spokesperson continued, “After our strategic review, we now expect a similar number of closures as openings, so we expect net unit growth in 2024 to be roughly flat.”
Wendy’s is a 55-year-old brand with over 7,100 locations scattered across the world, so closures like this are actually a fairly normal occurrence in the effort to maintain a healthy business ecosystem. The spokesperson with Wendy’s claimed that by the end of this year, the brand will have opened “more than 500 new restaurants over the last two years” and have the confidence to “deliver elevated growth in 2025 and the years to come.”
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