EYM Group, a multi-concept operator, recently made the decision to close more than two-dozen KFC restaurants in Illinois, Indiana, and Wisconsin. This move follows their previous actions of closing several units and placing others into bankruptcy protection.
KFC has confirmed the closure of several of its locations, including two units in Indianapolis and several others near Rockford and Peoria, Illinois.
Closing a restaurant is never an easy decision for both the franchisee and the brand, according to a statement from the company. However, it is important to note that all other KFC locations in these states are still open and ready to serve our valued guests.
EYM-owned restaurants have been experiencing a series of closures, and this is the most recent one.
In the past year, EYM made the decision to shut down 26 Burger King restaurants in Michigan. However, the company is now facing legal action from a landlord regarding one of these closures.
Earlier this year, EYM made the decision to close 15 Pizza Hut restaurants in Indiana as part of its ongoing struggles with the franchisor. Eventually, EYM had to file for bankruptcy, leading to the sale of most of its locations. In response to the bankruptcy filing, Pizza Hut expressed its willingness to collaborate with different stakeholders in an effort to keep the affected restaurants operational.
The restaurant closures are happening amidst ongoing difficulties in the industry, as restaurants grapple with the consequences of a combination of inflation and low sales. EYM’s various brands have faced their own sales struggles at different times over the past two years.
Several Burger King franchisees have filed for bankruptcy, while other operators, including EYM, have been forced to close units due to a decline in sales following the pandemic. Pizza Hut U.S. has also been facing challenges with weak same-store sales in recent quarters.
KFC U.S. has faced its fair share of challenges. This year, same-store sales took a significant hit, with a 5% decline. Furthermore, system sales have experienced a decline of 7% in the first half of the year.
Last year, the brand made the decision to close over 3% of its restaurants.
Executives at Yum Brands, the parent company, have expressed that they are actively working on revitalizing the brand in the United States. CEO David Gibbs openly acknowledged that the KFC brand has been facing challenges in the US market.
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Jonathan Maze, the Editor-in-Chief of Restaurant Business, is an experienced industry journalist who specializes in writing about restaurant finance, mergers and acquisitions, and the economy. He has a specific focus on quick-service restaurants.
