Burger King continues to close locations in the U.S.: forecast is 400 by year-end
The problem, according to CEO Joshua Kobza, is that for several months now, it has been reported to them that several large Burger King franchisees have filed for bankruptcy. Such as Illinois-based Toms King, Michigan-based EYM King and Utah-based Meridian Restaurants Unlimited.
Burger King is one of the most important franchises worldwide when it comes to the restaurant industry. Several weeks ago, it was announced that it would close some locations in the United States, in very specific states, but things will not end here, recently, the CEO of Restaurant Brands International Inc, owner of Burger King, said they are preparing to close between 300 and 400 locations by the end of 2023.
The problem, according to CEO Joshua Kobza, is that for several months now, it has been reported to them that several large Burger King franchisees have filed for bankruptcy. Such, as Toms King of Illinois, EYM King of Michigan, and Meridian Restaurants Unlimited of Utah.
One of his bets on improving the situation within the brand is that it will come to the ultimate closure of several locations, but also the focus the company will be making in the coming months on working with smaller franchisees with the goal of “improving the overall health” of its franchise chain.
“One of the most important factors is the willingness of our franchisees who have several restaurants to work with us and commit to implementing the necessary changes,” he said through a press briefing.
When questioned about the exact number of Burger King locations that will disappear, he said: “This will depend, to a certain extent, on the pace of business recovery, which we are already beginning to see”.
Along with these closures, a significant number of people are expected to join the ranks of the unemployed, as reintegration to some other locations is complicated.
This is not the first major brand to announce location closures. In previous months, stores such as Walmart, Walgreens, CVS and Bed Bath & Beyond have announced the permanent closure of hundreds of stores. The reason is low returns and in the case of Bed Bath & Beyond, things just got a lot more complicated, as they have just filed for bankruptcy.
This comes amid fears that the expected economic recession in the United States is getting closer and closer. This week, the U.S. Federal Reserve recently announced a new increase in federal interest rates, the eighth in recent months.