Why Wendy's Is Set To Close Hundreds Of Restaurants

Once famous for its "Where's the beef?" campaign, Wendy's has announced it will be trimming some of the fat from its national footprint. On a recent quarterly earnings call, Interim CEO Ken Cook told investors the company plans to begin closing many locations that aren't meeting sales expectations this year, with more slated to meet the same fate in 2026. The total number of restaurants being shuttered is predicted to be in the hundreds, with projections ranging from 240 to 360. Wendy's currently has roughly 6,000 restaurants in the United States.

Wendy's major competitors in the fast-food industry, Burger King and McDonald's, both experienced a profitable last quarter. Yet, the burger joint named after Dave Thomas' daughter witnessed sales drop by 4.7%. Opting to close hundreds of restaurants could be another sign that Wendy's may not be around much longer, but the hope is that by shuttering struggling locations, the company will free up investment capital for stores that are doing well.

While Wendy's as a whole isn't meeting investor expectations regarding sales, it has found some traction with one of its newest menu items. The restaurant's "Tendy's" have surpassed sales forecasts, with some locations blowing through their inventory before the chicken tenders were even being advertised to the public. In tandem with shuttering underperforming locations, Interim CEO Ken Cook indicated the company plans to capitalize on the popularity of poultry.

Closing stores and focusing on chicken sales aren't the only actions Wendy's is taking to right the ship. The company intends to transfer ownership of some of its failing restaurants to new owners in hopes that a fresh set of eyes might be able to turn things around. Wendy's also aims to invest in better equipment and technological resources amid its coming store closures.

Last year, Wendy's closed around 140 restaurants in a similar effort to prop up stores that were meeting or exceeding expectations. As of right now, there is no word on which locations will be on the chopping block over the coming year. Given that somewhere around 300 are going to be gone for good soon, there's a decent chance that a Wendy's near you might not be there anymore in the coming months.