Iconic Fast Food Chain Closing up to 200 Locations
It has been a brutal few years for fast food chains and restaurants, with many once-popular chains going bankrupt or being forced to close multiple locations due to financial woes. Some companies never fully recovered from the pandemic. Others fell victim to changing food trends, while some have experienced stress due to mismanagement. Recently, one iconic fast food chain revealed it is closing up to 200 restaurants in hopes of reviving finances.
Jack in the Box and Del Taco to Close Up to 200 Stores
Jack in the Box, currently operating 2,200 restaurants across the U.S., mainly on the West Coast, and 600 Del Taco restaurants, plans to close 150 to 200 restaurants. They added that before the end of 2025, 80 to 120 restaurants will shut their doors for good.
More Closures Expected as Franchise Agreements End
However, expect other restaurants to close shortly. The brand explains that the remaining underperforming restaurants will stop operations "upon respective franchise agreement termination dates," the company said.
Locations of 2025 Closures Have Not Been Revealed
Which restaurants are closing? Jack in the Box hasn't revealed the location of those closing in 2025. It also added that these closures do not include the expected 1.5% to 2.0% of system unit closures for FY2025 and an ongoing annual closure rate of approximately 1% of system units, starting in FY2026.
Closures Aimed at Long-Term Growth and Stability
The company is hopeful that these closures will ultimately result in growth for the brand. It expects "consistent, positive net unit growth" after closing the 150 to 200 underperforming locations.
CEO Outlines Plan to Cut Debt and Simplify Operations
"Our actions today focus on three main areas: addressing our balance sheet to accelerate cash flow and pay down debt, while preserving growth-oriented capital investments related to technology and restaurant reimage; closing underperforming restaurants to position ourselves for consistent net unit growth and competitive unit economics; and, an overall return to simplicity for the Jack in the Box business model and investor story," Jack in the Box CEO Lance Tucker said.
Del Taco Could Be Sold as Sales Decline Continues
Jack in the Box is also considering a possible divestment and other "strategic alternatives" for the Del Taco brand. Preliminary second-quarter same-store sales for Jack in the Box posted a 4.4% decline, while the Mexican-themed fast food brand experienced a decline of 3.6%.
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