Wendy’s plans to close hundreds of U.S. locations to address declining profits.

Wendy’s, the Dublin, Ohio-based fast-food chain, has announced plans to close hundreds of its U.S. restaurants in a strategic move aimed at bolstering profitability. During a recent conference call with investors, company representatives indicated that the closures would commence in the fourth quarter of the year, with an anticipated impact on a mid-single-digit percentage of its U.S. locations. While specific details regarding the number of closures were not disclosed, it is estimated that a 5% closure rate could amount to approximately 300 store closures of the 6,011 restaurants currently in operation.

This latest decision comes on the heels of Wendy’s prior announcement regarding the closure of 240 locations in 2024, a response to the growing sentiment that many restaurants within the 55-year-old chain have become outdated. Ken Cook, who stepped into the role of interim CEO in July after the departure of Kirk Tanner, asserted that the initiative to shutter underperforming restaurants is crucial to enhancing customer traffic and overall profitability at the remaining outlets.

Cook emphasized that a significant portion of these restaurants does not align with the brand’s standards and contribute to financial challenges for franchisees. The company’s goal, he noted, is to address these deficiencies effectively. In instances where locations are struggling, Wendy’s plans to implement improvements by integrating new technology or equipment. In other scenarios, the company may opt to transfer ownership to different operators or ultimately close the establishments.

The fast-food landscape has been particularly challenging, with U.S. chains grappling to attract lower-income consumers amid rising inflation impacting food prices. During the July to September period, Wendy’s reported a 5% decline in U.S. same-store sales compared to the prior year, a trend that underscores the company’s pressing need to revamp its strategies.

In response to these challenges, Wendy’s has introduced meal deals priced between and , which have reportedly helped drive some traffic back to its stores. However, the current management acknowledges that attracting new customers remains a hurdle, prompting a forthcoming shift in marketing strategies to highlight value and the freshness of its ingredients.

Following these announcements, shares of Wendy’s experienced a decline, closing down 4.8% on Monday. As the company navigates through these decisions, its focus is clearly set on restructuring its operations to optimize profitability in an increasingly competitive marketplace.

For further details regarding Wendy’s ongoing initiatives, keep an eye on updates from various media channels for potential developments.