Jack in the Box to Close Up to 200 Underperforming Locations: Is a Del Taco Sale Next?

Jack in the Box is making some significant moves to improve its financial health. On Wednesday, the fast-food chain announced plans to shut down 150 to 200 underperforming locations. It’s also considering selling Del Taco, which it acquired three years ago.

Jack in the Box operates about 2,200 restaurants across 22 states, mainly on the West Coast and Midwest. The company plans to close 80 to 120 locations by the end of 2025. The rest will close as franchise agreements come to an end.

In a bid to strengthen its business, Jack in the Box introduced the “Jack on Track” plan. This strategy aims to enhance long-term financial performance and explore options for Del Taco, including a potential sale. Jack in the Box bought Del Taco for around $585 million in March 2022, excited about the similarities in guest profiles and menu offerings.

Lance Tucker, the new CEO, emphasized that simplifying their business model would maximize shareholder returns. He believes that closing these locations will help stabilize the company’s balance sheet and pave the way for future growth.

In the last financial quarter, Jack in the Box opened five new restaurants and closed twelve. Del Taco saw a different pattern, with six openings and four closures.

While the chain hasn’t revealed which locations will shut down, it operates restaurants across states like California, Texas, and Arizona.

In today’s fast-food market, where consumer preferences are constantly changing, many brands face similar challenges. According to recent data, around 40% of restaurants are re-evaluating their operations to stay competitive. Jack in the Box’s decision to streamline its locations and revisit its acquisitions reflects a broader trend in the industry.

For more details on their plans, check out the official announcement here.

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