McDonald's Is Shrinking for the First Time in Decades

This year marks the first time that fast-food giant will close more U.S. locations than it opens.

June 22, 2015

OAK BROOK, Ill. – Another week, another announcement from McDonald’s about the latest facet of its turnaround plan. Last week, the burger chain announced that for the first time in more than 40 years, it is losing stores in the United States.

According to news reports, McDonald's plans to close more restaurants in the United States than it opens this year. CNBC writes that that hasn't happened since at least 1970 – and perhaps ever -- according to a review of McDonald's regulatory filings. While McDonald's declined to provide a specific figure, they said the reduction would be "minimal" in respect to its 14,000-plus U.S. locations.

Still, it’s hard not to see the news as indicative of the larger issues McDonald’s is facing, and the company’s efforts to turn things around. In April, McDonald's said it would close about 700 underperforming locations around the world this year, including in the United States. The U.S. store closings will be a mix of franchised and company-owned locations, but McDonald’s has not yet announced which locations are expected to close. 

Closing weak stores isn't unusual for companies trying to turn around their fortune, points out CNBC. Starbucks CEO Howard Schultz shuttered hundreds of U.S. locations after returning to head the company in 2008. Since then, the coffee chain has enjoyed healthy sales growth and expanded its footprint. And even after closing 700 locations, McDonald's will easily remain the country's biggest hamburger chain.

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