Plenty of struggling restaurants turned to bankruptcy protection this year as some bumpiness from the pandemic continued to work its way out. But many others turned to mass closures as a strategy to (eventually) achieve a healthier system.
In 2023, nearly 33% of ranked chains experienced a net decrease in locations — an uptick in chain closure rates versus both 2022 and 2021. That trend has continued in 2024.
To be sure, retrenchment focused on low-performing units has long been an approach for brands to ensure long-term viability. Though many of this year’s closures were likely triggered by hemorrhaging cash flow and traffic amid higher costs and debt, the decision to shutter locations is also often made whenever there are changing market or demographic dynamics. The pandemic caused a seismic shift toward work-from-home, for instance, and urban center closures ensued accordingly.
Many brands make the decision to close lower-performing restaurants so they can sharpen their focus on stronger units, generate higher four-wall profitability, and then get back to growing again. There’s long been an ebb and flow cycle of openings and closings in this industry, but 2024 just happened to have a strong ebb. Here is a look at some of the massive closures – or closure plans – from 2024.
