Papa John’s, which operates on a global scale and also has branches in Turkey, is entering a large-scale restructuring process in the North American market. The company has decided to remove from its system those restaurants that do not meet brand standards and show no signs of sustainable financial recovery.
GRADUAL CLOSURES UNTIL 2027
In line with the announced plan, approximately 300 restaurants will be closed gradually by the end of 2027. It is projected that about 200 of these branches will shut down within this year.
Company management stated that this step is part of a strategy to redirect resources toward stronger locations and new investments.
600 THOUSAND DOLLAR THRESHOLD
Papa John’s Chief Financial Officer Ravi Thanawala announced that a significant portion of the restaurants to be closed are franchise operations older than 10 years.
By removing branches with an annual sales volume of less than 600 thousand dollars (approximately 26.38 million TL) from the system, the chain aims to increase the average sales volume across the entire network by at least 3 percent.
5.4 PERCENT DROP IN SALES
The company announced that it experienced a 5.4 percent decline in sales in the fourth quarter. CEO Todd Penegor attributed this drop to a weak consumer environment and increasing promotional competition in the sector.
CONTRACTION IN THE SECTOR CONTINUES
The developments were not limited to Papa John’s. Rival chain Pizza Hut also announced that it would close 250 of its branches across the US by June. Yum! Brands, the parent company of Pizza Hut, stated that the decision is part of a strategy to modernize the restaurant network and remove inefficient locations from the system.
News Source: 12punto
