Plans For Pizza Hut Closings in 2022

Joel Eisenberg

The perennial brand has permanently closed hundreds of locations since the advent of the pandemic and the closure of its main franchise partner. Is the chain vulnerable to further loss, or will those closings prove to be outliers?

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Pizza HutShutterstock

Author’s Note

This article is based on corporate postings and accredited media reports. All linked information within this article is fully-attributed to the following outlets: ScrapeHero.com, Wikipedia.org, RestaurantClicks.com, Yum.com, FlynnRestaurantGroup.com, and QSRMagazine.com.

Introduction

According to ScrapeHero.com: There are 6,612 Pizza Hut locations in the United States as of May 23, 2022. The state with the most number of Pizza Hut locations in the US is Texas, with 873 locations, which is 13% of all Pizza Hut locations in America.

At first glance, for any chain restaurant — or any company, for that matter — to maintain such a large U.S. presence would imply strong financial health and ongoing growth. In recent years, however, Pizza Hut has appeared on several media lists of food companies most likely to downsize, or shutter entirely.

All told, there are over 18,000 Pizza Hut locations worldwide, according to RestaurantClicks.com. See here for the March, 2022 RestaurantClicks.com piece, “The Truth Behind Rumors of Pizza Hut Closing,” which directly addresses those lists, and related online rumors.

As excerpted from the article: In recent years, though, many locations have been closing their doors, leaving fans wondering: is Pizza Hut closing? Like many dine-in restaurants, Pizza Hut has been facing financial challenges since the onset of the COVID-19 pandemic. As the company shifts its focus to delivery and carry-out options they have been shuttering some of their less profitable dine-in locations, prompting rumors that Pizza Hut will soon be disappearing for good.

The article goes on to elaborate upon the closings, specifically discussing the company’s announcement of August, 2019 regarding its plans to close around 500 restaurants across the U.S. by 2021, and its unexpected 2020 announcement regarding the closure of 300 more restaurants after franchise provider NPC International declared bankruptcy.

Those reports of recent years may appear to be grim, but due to the bankruptcy and other factors is Pizza Hut actually bound to close all of its locations for good?

Let us explore further.

Pizza Hut, 2022

Wikipedia.org features a comprehensive overview of the Pizza Hut chain. See here.

From the Wikipedia page, which claims the pizza company, founded in 1958, is the largest of its type in the world based on locations: Pizza Hut is split into several different restaurant formats: the original family-style dine-in locations; storefront delivery and carry-out locations; and hybrid locations that have carry-out, delivery, and dine-in options. Some full-size Pizza Hut locations have a lunch buffet, with "all-you-can-eat" pizza, salad, desserts, and breadsticks, and a pasta bar. Pizza Hut has other business concepts independent of the store type.

The company is a subsidiary of Yum! Brands, Inc., one of the world’s largest restaurant conglomerates in business with the franchise owners of Taco Bell, KFC, and The Habit Burger Grill. See here for the company’s website, which states: Yum! Brands, Inc., based in Louisville, Kentucky, has over 53,000 restaurants in more than 155 countries and territories primarily operating the company’s restaurant brands – KFC, Pizza Hut and Taco Bell – global leaders of the chicken, pizza and Mexican-style food categories. The Company’s family of brands also includes The Habit Burger Grill, a fast-casual restaurant concept specializing in made-to-order chargrilled burgers, sandwiches and more. In 2021, Yum! Brands was named to the Dow Jones Sustainability North America Index and was ranked on Newsweek's list of America's Most Responsible Companies.

Though the other companies listed are in various states of business health, the issue is not with Yum! Brands, Inc. In the case of Pizza Hut specifically, the larger issue remains with the bankruptcy of NPC International, which has been defunct since 2020 and appears to have been the primary source of concern from most observed indicators.

According to the entity’s Wikipedia page: NPC was the largest franchisee of both Pizza Hut and Wendy’s, and owned more than 1,200 Pizza Hut locations and 385 Wendy's locations until March 2021... NPC filed for Chapter 11 bankruptcy on July 1, 2020. Analysts pointed to a "perfect storm of problems, including coronavirus-related shutdowns, a massive debt burden of nearly $1 billion and rising labor and food costs."

The NPC International Wikipedia page furthers that Flynn Restaurant Group bid $816 million to acquire the entirety of NPC's business in November of 2020, a deal that was consummated four months later.

Today, according to FlynnRestaurantGroup.com, the company‘s holdings have increased since that deal closed: With approximately 2,400 Applebee's, Taco Bells, Paneras, Arby's, Pizza Huts and Wendy's restaurants generating $4 billion in sales and employing 73,000 people in 44 states, Flynn Restaurant Group is the largest franchise operator in the world.

Pizza Hut‘s business is said to have improved under Flynn Restaurant Group’s guidance. According to restaurant industry stalwart QSRMagazine.com, in their January, 2022 article entitled “QSR’s Transformational Brand of 2021: Pizza Hut Finds its North Star,” the pizza chain’s fortunes had markedly changed during the period the deal was announced: To put it plainly, the vibe changed dramatically in 2020, and hasn’t let up. Pizza Hut’s U.S. division posted 2 percent same-store sales growth in Q3, announced in late October. Pulled back, it gave the brand an 8 percent two-year stack. And Pizza Hut’s off-premises channel was up 17 percent.

Conclusion

Pizza Hut came close to potentially brand-threatening business challenges, but Flynn Restaurant Group in part appears to have turned around the company’s fortunes, as has the implementation of new business strategies and executives.

Thank you for reading.

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I am an award-winning author, screenwriter for film and television, and producer. My mission on News Break is to share socially important perspectives on both culture and pop-culture. Member of PEN America, and the WGA.

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