In a strategic bid to revitalize its operations, Denny’s announced plans to close 150 underperforming restaurants across the United States over the next year. This move, disclosed during the company’s recent earnings call, will initially see 50 locations shuttered by the end of 2024, representing approximately 10% of its 1,375-strong domestic footprint.
The decision to downsize is largely driven by the financial drag posed by these struggling outlets on the company’s overall performance. Concurrently, Denny’s is streamlining its menu, paring down the offerings from 97 items to a more focused 46. This shift is partly in response to observed consumer behavior, where adults have increasingly opted for more affordable options from the kids’ menu.
Denny’s restructuring efforts mirror a broader trend within the restaurant industry. Recent months have seen notable closures, including Rubio’s Coastal Grill shutting 48 California locations in June, citing escalating operational costs. Similarly, Hooters and Red Lobster have also trimmed their portfolios, with the latter closing over 100 underperforming U.S. sites in May.
These developments coincide with rising fast food prices, exacerbated by inflation under the current administration. According to the Centers for Disease Control and Prevention (CDC), the impact of fast food inflation is disproportionately felt across different racial and ethnic groups, given varying consumption patterns. For instance, 42.4% of non-Hispanic black adults consume fast food regularly, compared to 37.6% of non-Hispanic white adults.
The economic ripple effects may also have political implications, as indicated by a Wall Street Journal poll. The survey revealed a notable shift in voting intentions among black voters, with 30% of black men and 11% of black women now inclined to support former President Donald Trump, marking a significant increase from 2020 levels.
