Twenty-six Michigan Burger King franchises are slated to shut down by mid-April, according to a letter from a major franchise operator.
A letter from EYM King Michigan, LLC, to the Michigan Department of Labor and Economic Opportunity said the company will “[p]ermanently cease operations in Michigan due to the unforeseen business circumstances and not being able to reach a resolution with the Burger King Corporation.”
According to the letter, the company began closing locations on March 17, and the company plans to close all 26 locations by or around April 15.
The company noted a total of 424 employees are expected to be laid off, none of whom are represented by a union.
Reuters reported Restaurant Brands International Inc., which owns the Burger King brand, has been executing a “turnaround plan” amidst rising operating costs, noting that some franchise operators have struggled in the current environment:
The company, which also owns Popeyes, Tim Hortons and Firehouse Subs, slightly missed Wall Street profit estimates for its fourth quarter ended Dec. 31, due in part to higher operating expenses. Shares fell more than 3.5%.
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“There are definitely some operators that have been struggling,” [Chief Operating Officer and incoming CEO] Kobza told Reuters in a phone interview. “If there have to be restructurings, we’re going to be intimately involved in those,” to help set the franchisees up for success, he said.
FOX 2 spoke with an employee after the closure of the franchise she worked for was announced.
“They just said they were closing down they didn’t say the reason,” she told the outlet. “If you hire somebody, let them know all the information so that way they can make their decision if they want to work here or not or find another one,” she said. “Because if she would have told me at the beginning I wouldn’t did it.”