Wendy’s is undertaking a significant restructuring, planning to close hundreds of underperforming U.S. Restaurants in the first half of . The move comes after a disappointing fourth quarter of , with global same-store sales falling 8.3% and U.S. Sales declining 11.3%, according to the company’s earnings report released Friday.
The Dublin, Ohio-based fast-food chain expects to shutter between 5% and 6% of its 5,969 U.S. Locations – approximately 298 to 358 restaurants – in the coming months. This follows the closure of 240 U.S. Wendy’s locations in , and an additional 28 restaurants closed in the fourth quarter of .
The closures are part of a broader turnaround plan, dubbed “Project Fresh,” announced in October . The strategy aims to revitalize the brand, accelerate profitability, and reignite growth. A key component of this plan is a renewed focus on value, acknowledging that previous attempts relied too heavily on limited-time price promotions rather than consistent, everyday value offerings.
“Learning from around value, we swung the pendulum too far towards limited-time price promotions instead of everyday value,” said Ken Cook, Wendy’s interim CEO and chief financial officer, during a conference call with investors. This admission signals a shift in strategy, mirroring the success seen by competitors like McDonald’s, which has experienced a 6.8% increase in U.S. Sales in the fourth quarter by emphasizing value to inflation-weary customers.
The decision to close restaurants isn’t solely driven by recent sales figures. The company has previously stated that many locations are outdated and require significant investment to remain competitive. Project Fresh is intended to address these infrastructural issues and modernize the Wendy’s footprint.
While the company is streamlining its U.S. Operations, it continues to see strong growth internationally. The earnings report highlighted international performance as a bright spot, though specific figures were not detailed in the available reports. This suggests a strategic focus on expanding in markets outside the U.S. While consolidating its presence domestically.
The closures are expected to impact franchisees, as well as corporate-owned locations. The company did not provide a breakdown of how the closures will be distributed between the two ownership models. However, the scale of the closures – potentially over 350 restaurants in the first half of – indicates a substantial restructuring of the Wendy’s network.
Despite the challenging fourth quarter, Wendy’s is maintaining its “Biggie Deals” value menu, indicating a commitment to attracting customers with affordable options. The company is also planning new everyday Biggie value offerings and menu innovation throughout , as part of its effort to regain market share.
The company’s performance in reflects broader trends in the fast-food industry, where consumers are increasingly price-sensitive due to persistent inflation and economic uncertainty. The success of Project Fresh will depend on Wendy’s ability to effectively balance cost-cutting measures with investments in value and innovation, and to adapt to the evolving preferences of its customer base.
The closures represent a significant strategic shift for Wendy’s, signaling a willingness to prioritize long-term profitability over short-term growth. The company’s leadership believes that a leaner, more focused network of restaurants, coupled with a renewed emphasis on value, will position Wendy’s for sustained success in a competitive market.
