February 15th 2025.
It seems that Denny's, the popular American casual diner chain, will be closing even more locations than previously announced. In addition to the 150 restaurants that were already marked for closure, it has been reported that over three dozen more will be shutting their doors.
Back in October, Denny's had stated that they would be closing 50 locations by the end of 2024 and another 100 in 2025, which would amount to about 10% of their restaurants across the US. However, during an investors call on Wednesday, the company's chief financial officer, Robert Verostek, revealed that the number of closures for this year will actually be higher, with 70 to 90 locations expected to shut down. To make matters worse, it was also mentioned that 88 restaurants were closed last year, which means that up to 38 more will be added to the list of closures.
These diners that are set to close have been in operation for an average of almost 30 years. According to Versostek, in any established brand, it is natural for trade areas to shift over time. This could explain why these specific locations are no longer performing as well as they used to.
The decision to accelerate the closure of these lower-volume restaurants was made in order to improve cash flow for franchisees. This will allow them to reinvest in initiatives that will drive more traffic to their remaining locations, such as the company's tested and proven remodel program. It has been stated that some of the locations that are set to close are in aging buildings or have expiring leases.
Overall, while it is unfortunate that these Denny's restaurants will be closing, it seems that the company is taking proactive measures to ensure the success of its remaining locations. By closing these lower-performing restaurants, franchisees will have the opportunity to invest in strategies that will attract more customers and ultimately benefit the brand as a whole.
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