Wendy's Evaluates Its Restaurants to Boost Sales
The fast-food burger chain Wendy's is intensively reviewing its weakest restaurants to reverse a recent decline in sales. The company is collaborating with franchisees to address underperforming locations through various strategies, including fixing, selling, or closing stores.
Plans to Improve Struggling Locations
During a recent discussion with investors, Wendy's, based in Dublin, Ohio, revealed it is working closely with franchisees to develop customized plans for their less successful restaurants. Possible actions include:
- Investments in assets and equipment
- Improvements in service and operations
- Sale of stores to other franchisees
- Potential closures of some locations, starting as early as this year
Impact on U.S. Restaurants
“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,” said Ken Cook, Wendy's interim CEO.
Cook estimated that a “mid-single-digit percentage” of U.S. Wendy’s outlets may close following this review. With nearly 6,000 locations nationwide, this could mean fewer than 300 closures.
Focus on Operational Enhancements
The goal, according to Cook, is to address and improve these locations through operational upgrades, new technology, or equipment enhancements, aiming to strengthen franchisee performance and overall brand value.
“The goal is to address and fix those restaurants. So in some cases that’s going to mean deploying operational improvements, deploying additional technology or equipment.”
This strategy reflects Wendy's effort to prioritize service quality and unit growth as it navigates current challenges in the fast-food market.
Summary: Wendy's is assessing its weakest restaurants and partnering with franchisees to improve, sell, or close locations, aiming to enhance brand value and sales performance while potentially closing up to 300 stores.