Pizza Hut Is Closing 250 Locations—What’s Going On?

It’s a sad day for The Hut. Yum! Brands just announced that they will close 250 pizza hut locations across the country. So you better get that stuffed crust, because your closest Hut might be shutting down. 

Why is Pizza Hut closing locations? Is it going out of business?

Don’t worry, you’ll still be able to get your personal pan pizza somewhere. Even though the locations set to close are “underperforming,” per Yum! Brands, the bulk of Pizza Hut locations will remain open. There are around 20,000 Pizza Hut locations around the world. So 250 isn’t that many in the grand scheme of things. But still…it makes you wonder…what’s going on?

What is going on? Why are they closing Pizza Huts?

According to USA Today, during a recent Yum! Brands earnings call, CFO Ranjith Roy said it was all part of something they’re calling “Hut Forward,” which entails “marketing, modernization of technology, and franchise agreements.” That’s a whole lot of corporate mambojumbo if you ask me. What’s this really about? Well, Pizza Hut sales in the U.S. declined by 3% in the fourth quarter of last year. That might not seem like a big deal, but when you compare it to another Yum! Brands property, Taco Bell, which saw a 7% increase in sales during that same quarter, it starts to look bad. 

Is this the end of Pizza Hut?

Probably not. But it might be the beginning of the start of the initiation of the end of Pizza Hut’s relationship with Yum! Brands. Here’s what Chris Turner, Chief Executive Officer, Yum! Brands Inc., had to say in a Yum! Brands press release from last November: “The Pizza Hut team has been working hard to address business and category challenges; however, Pizza Hut’s performance indicates the need to take additional action to help the brand realize its full value, which may be better executed outside of Yum! Brands…To truly take advantage of the brand we’ve built and the opportunities ahead, we’ve made the decision to initiate a thorough review of strategic options.” In my experience, when a company starts “exploring options” it means they’re trying to offload something or someone. But that’s just conjecture, of course.