Wendy’s to Close 140 Underperforming Restaurants by End of 2024, Plans to Open New Locations

Wendy's, the Ohio-based fast-food chain, has announced plans to close 140 of its restaurants by the end of 2024. This move comes on top of the 100 restaurant closures the company had previously announced in May. According to Wendy’s President and CEO Kirk Tanner, the restaurants slated for closure are “underperforming” and “outdated” compared to other locations.

Tanner explained during an investor conference call that the decision to close these restaurants was made after a thorough review to ensure they meet the company’s expectations for sales, profitability, and brand experience. The locations marked for closure are distributed across the U.S. and have an average unit volume (AUV) of approximately $1.1 million, which is significantly lower than the $2 million AUV considered healthy by Wendy’s.

To offset these closures, Wendy’s plans to open between 250 and 300 new restaurants this year. Tanner emphasized that the new restaurants will be located in better areas with improved sales and profitability, ensuring that the company’s overall footprint remains stable.

As of the end of the third quarter, Wendy’s operated 7,292 restaurants globally, with over 80% of these locations in the U.S. Despite the closures, the company aims to maintain its net unit growth approximately flat compared to the prior year.

The announcement is part of a broader trend in the restaurant industry, where several chains, including Denny’s, Red Lobster, Hooters, and TGI Fridays, have also closed underperforming locations in recent times.