One of the nation's largest Wendy's franchisees has filed for bankruptcy and could close locations if business conditions do not improve.
Meritage Hospitality Group, which owns 314 Wendy’s locations across 15 states, filed for Chapter 11 bankruptcy in the United States Bankruptcy Court for the Western District of Michigan on Sept. 17.
The franchisee stated in court documents that it owes nearly $25 million to Wendy’s International.
In 2025, Wendy's announced plans to close around 300 stores nationwide by the end of the year. This year, Wendy's reported opening 44 U.S. restaurants during the first and second quarters of 2026.
Wendy's said in a statement to USA TODAY on Sept. 21 that the company is focused on "serving our customers, supporting our franchise
system and strengthening the long-term health of the brand."
Here is what we know so far about potential impact in Tennessee.
Why did a Wendy's franchisee file for bankruptcy?
Part of the reason for the bankruptcy filing was an 11.3% decrease in same-store sales during the final quarter of 2025 and unusual winter weather linked to the La Niña cycle in the southern United States, which impacted sales, the company said in court documents.
The company also cited reduced effectiveness of Wendy’s brand marketing, which Wendy’s previously managed.
The company also noted that it filed for bankruptcy due to record U.S. beef prices tied to:
- Historically low herd levels.
- A shutdown of Mexican border beef imports due to disease.
- Tariffs on beef from South America, leading to an 18.9% increase in the company's average cost of beef compared with the previous year.
The company has 8,850 employees and has asked for permission to pay wages, other compensation, reimbursable expenses and continue honoring its Employee Benefits Programs, per court documents.
The company has also asked for permission to continue honoring Wendy’s gift cards and loyalty programs.
How many Tennessee locations are there?
According to a USA TODAY report, Meritage Hospitality Group operates 24 Wendy's locations in Tennessee. This is the fifth-highest number among the states where the company operates.
In total, there are 167 Wendy's locations. Memphis and Knoxville have the largest markets with 13 locations each. Most other cities in Tennessee have between one and three restaurants.
Are the franchisee's Wendy's locations closing?
The company said in court documents that it plans to weigh its options and restructure, which could include closing or selling underperforming locations.
The company noted that it is working on "preserving jobs and restaurant operations across the 15-state footprint."
The company owes 1,000-5,000 creditors, with assets and liabilities ranging from $10 million to $50 million, according to documents USA TODAY reviewed.
USA TODAY contributed to this report.
Jordan Green covers trending news for The Commercial Appeal and Tennessee. She can be reached at jordan.green@commercialappeal.com.
This article originally appeared on Memphis Commercial Appeal: A major Wendy's franchisee went bankrupt. How many are in Tennessee?
