QSR: Yum! Brands Has 7,000 Restaurants Closed Globally

QSR is reporting that franchise behemoth Yum! Brands has closed roughly 7,000 restaurants globally, about 14 percent of the conglomerate’s total units. Though an exact time frame is not specified, the mass closures are all but certainly largely the result of the COVID-19 outbreak that has ravaged the restaurant industry. 

Pizza Hut has been hit the hardest, closing more than 1,000 domestic locations of its small-model Pizza Hut Express stores. Fortunately for the legacy pizza brand, that closure rate may not be indicative of the franchise’s overall outlook.

[BTIG analyst Peter] Saleh said the Pizza Hut Express closures are “not that meaningful” given they’re airport, campus, stadium, etc., units seeing minimal traffic these days. “… we believe this just adds to challenges facing Pizza Hut in the U.S.,” Saleh wrote.

Still, Pizza Hut’s closures come at a particularly difficult time for the franchise, which recently embarked on a multi-year initiative to transition the primarily dine-in in store model to a more carryout- and delivery-oriented one.

...Pizza Hut was seeing a wide gap between dine-in sales and sales from delivery and carryout, with both the U.S. and international experiencing a roughly 10-point differential. Dine-in sales had fallen to less than 10 percent of total sales domestically but were dragging the comp heavy.

KFC, too, closed more than 900 of its U.K. stores, and in many markets, including the U.S., even stores left open have reduced their operations to just drive-thru, delivery and carryout. 

Read the full article at qsr.com.