In the wake of the coronavirus pandemic, many businesses are struggling to stay afloat. The restaurant industry has been hit particularly hard, and even the fast-food sector has struggled with faltering sales.
The latest manifestation of the virus’s destruction: Dunkin’, McDonald’s and Starbucks all plan to close a combined 1,400 locations throughout the United States.
Dunkin’ will permanently close approximately 800 stores, which accounts for 8% of its locations in the U.S. More than half of the affected locations are inside Speedway convenience stores.
“Including the 450 Speedway closures, we believe there could be approximately 800 low-volume locations, primarily alternative points of distribution, that may close,” a spokesperson for the company told Newsweek. “Most of these locations are also unprofitable for the franchisees and are well below average for both sales and profitability.”
McDonald’s will close 200 of its 14,000 United States locations this year, with half of those restaurants being “low-volume” locations inside Walmart stores.
Worldwide, 96% of McDonald’s restaurants are now open, compared with 75% at the start of the second quarter. In April, comparable-store sales were down 39%, compared to just 12% in June.
“Within a matter of weeks, the McDonald’s system made operational modifications across 30,000 restaurants, while closing and then reopening another 9,000 restaurants,” McDonald’s CEO Chris Kempczinski said during an earnings call on July 30, according to USA Today.
“We introduced new safety procedures in all our restaurants, modified our menus and developed new contactless ways to serve our customers.”
Starbucks will close 400 U.S. locations as the company estimates that $3.1 billion was lost in revenue due to the pandemic. Despite these losses, Starbucks opened 130 new cafes worldwide between April and June.
“We still have a long ways to get back to full recovery, but we’re optimistic based on the strength of our brand and the strategy and initiatives that we have to drive sales and improve margins,” Starbucks CFO Pat Grismer told CNBC.
Read about more stores closing locations around the country this year.