Wendy's Reviews Struggling Restaurants to Boost Sales
The fast-food burger chain Wendy’s is intensively evaluating its weakest restaurants to reverse a recent sales decline. The company is collaborating with franchisees to decide whether to improve, sell, or close underperforming locations.
Plans for Weaker Locations
During a recent investor meeting, Wendy’s executives outlined several strategies for struggling restaurants, including:
- Investing in the assets
- Improving service and operations
- Selling stores to other franchisees
- Closing some locations
Closures could begin this year, targeting a "mid-single-digit percentage" of U.S. restaurants, according to interim CEO Ken Cook.
Scale of Potential Closures
Wendy’s has just under 6,000 locations nationwide. A mid-single-digit percentage closure suggests fewer than 300 restaurants might eventually shut down.
“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. “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."
Focus on Improvement and Growth
The company aims to focus on service enhancements and increasing unit volumes as part of its turnaround effort.
Author’s summary: Wendy’s is taking decisive actions to revive sales by working with franchisees to improve, sell, or close hundreds of weaker restaurants, focusing on operational upgrades and growth.