American fast-food giant Wendy's has announced plans to close as many as 300 restaurants across the United States, as the burger chain confronts a dramatic sales decline and growing customer complaints about soaring prices.
A Turnaround Plan in Response to Plummeting Sales
The Ohio-based company revealed the sweeping closures on Friday as part of a major turnaround strategy designed to tackle plunging revenues. Wendy's warned Wall Street that sales at its 6,000 US locations fell by 4.7 percent over the last quarter. This sharp drop is equivalent to the chain selling approximately 1.7 million fewer of its signature Junior Cheeseburgers compared to the same period last year.
This is not the first wave of shutdowns for the chain, which also closed 140 underperforming restaurants last year. Like its rivals, Wendy's is facing a harsh new market reality where American consumers are significantly cutting back on takeout meals. This trend is driven by a combination of shrinking household budgets, intense competitor price-cutting, and widespread perception that fast food no longer offers good value.
The Core Problems: Sticker Shock and Dated Stores
Industry analysts point to two primary reasons for Wendy's struggles, both of which are infuriating its customer base. The first is simple: the food has become too expensive. A basic burger and fries can now cost over $12, with Baconator combos topping $12.39 and Dave's Double meals exceeding $11. These are prices that many consumers feel should buy a sit-down restaurant experience, not a fast-food meal.
"Fast food has moved from being an inexpensive indulgence to an expensive option," stated Neil Saunders, Managing Director at GlobalData. "So a lot of consumers are cutting back."
The second major issue is the physical state of many Wendy's outlets. Customers report being put off by tired-looking, outdated restaurants and slow, inefficient technology. This is a particular problem when compared to competitors like McDonald's and Chick-fil-A, where mobile app and kiosk ordering provide a seamless experience.
Jerry Thomas, CEO of research firm Decision Analyst, believes the problems are deeply rooted. "Wendy's is suffering from underinvestment in its restaurants," Thomas said. "It's now paying the price for years of neglect."
Project Fresh: A Bid for Survival
In response, the nation's third-largest burger chain is launching a comprehensive revival plan dubbed Project Fresh. This initiative will involve closing weaker-performing restaurants, investing in the refurbishment of stronger locations, and slashing approximately $20 million in operating costs.
Announcing the strategic shift, interim Wendy's CEO Ken Cook said the company aims to boost sales and profits by channelling more investment into its best-performing stores and shutting down those that are a drag on the business. The logic is that by removing struggling locations, the remaining, busier restaurants will benefit from a cleaner, faster, and more consistent service that customers will notice.
Wendy's is also attempting to modernise its brand image through celebrity advertising campaigns, including one featuring former NFL running back Reggie Bush. The company confirms it is reviewing its promotions and store designs as part of this broader reset.
The challenges facing Wendy's reflect a wider slowdown across the fast-food industry, where shoppers are re-evaluating what truly represents value. While chains like Sweetgreen, Chipotle, and Starbucks also report sales declines or store closures, those that have aggressively cut prices, such as Chili's and McDonald's, are seeing significant sales growth and reporting consecutive quarters of success.
