Papa Murphy’s to close dozens more locations
Papa Murphy’s to close 45-50 locations in response to underperformance and market challenges.
auto_awesome
Papa Murphy’s will close 68 stores across its portfolio, with 45 to 50 closures specifically from its take-and-bake pizza chain. This represents a reduction of over 20% in their U.S. footprint since 2020 as the brand struggles in a highly competitive market with declining consumer loyalty and sales.
Why It Matters
This may compress available territories for franchisees as the brand refocuses on stronger performing units, although it signals ongoing challenges within the QSR pizza sector.
Papa Murphy's, a take-and-bake pizza chain under MTY Food Group, is set to close 68 underperforming corporate-owned locations across its stores, with 45 to 50 of these closures attributed to Papa Murphy's specifically. This marks a significant reduction of its U.S. footprint, which is now over 20% smaller than in 2020. The closures are anticipated to occur over the next nine months, beginning imminently.
CEO Eric Lefebvre expressed that the pizza category is facing intense competition, resulting in minimal consumer loyalty and challenges in attracting diners. “We run different promotions and we see that there's very little loyalty in that market and the consumer will go where the pizza is the cheapest at any given time,” he noted. The company has been grappling with a lack of profitability in certain markets, with the locations slated for closure having incurred losses exceeding $10 million in the past year.
Despite efforts to revitalize sales, including MTY's earlier acquisition of clusters of Papa Murphy's stores, Lefebvre indicated that such strategies had not led to the desired outcomes. “We came to the conclusion that these markets are probably not appropriate for Papa Murphy's at this time,” he said. MTY’s evaluation of store performance led to decisions aimed at reducing losses and focusing on units with stronger returns.
