The fast-food burger sector has been facing economic challenges in the past year, resulting in major chains like A&W Restaurants closing down locations. A significant issue for burger chains has been mixed sales results, with some experiencing growth while others faced declines.
McDonald’s, the leading fast-food burger chain, reported a 2.1% increase in U.S. sales in 2025, showcasing another successful year for the company. In contrast, Wendy’s saw a decline of 5.2% in U.S. sales, while Burger King experienced a 1.6% increase.
Wendy’s announced plans to close 5%-6% of its U.S. restaurant locations in 2026 due to underperformance as part of its Project Fresh turnaround plan. Other burger chains are also shutting down underperforming locations that are no longer economically viable.
One such example is A&W Restaurants, which recently closed its River Hills Mall location in Mankato, Minn., due to financial distress. Another A&W Restaurant in Pocatello, Idaho, closed its doors permanently as the franchisee struggled financially and had its franchise contract terminated.
The closure of the Pocatello location led to an outpouring of community support, with the restaurant reportedly selling out of all its remaining stock before closing a day early. The 107-year-old A&W chain has been facing challenges, with declining foot traffic and rising business costs affecting its operations.
In response to these challenges, the Ohio-based owner of the A&W property is in negotiations with Popeyes to transition the location into a fried chicken franchise. Additionally, one of A&W’s legendary restaurants in St. Helena, Calif., closed after nearly 60 years due to various factors, including declining foot traffic and operational costs.
Yum Brands sold A&W Restaurants Inc. to A Great American Brand LLC in 2011, along with selling its Long John Silver’s chain to another group of franchisees. The A&W chain, founded in 1919, operates around 850 restaurants in 35 states and Asia, with both standalone locations and co-branded units with KFC or Long John Silver’s.
As the fast-food burger sector continues to evolve and adapt to economic challenges, it is essential for chains to reassess their operations and make strategic decisions to ensure long-term success in a competitive market.
