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Fact Check: Wendy's Is Closing All Locations, as Announced in Late 2023?

A rumor in Facebook and Instagram ads claimed that Wendy
JIM WATSON/AFP via Getty Images

Claim:

Wendy's fast-food restaurant chain plans to close down, as hinted at in online advertisements displayed on Facebook and Instagram in late 2023.

Rating:

Rating: False
Rating: False

In October and November 2023, online advertisements were displayed to users on Facebook and Instagram that each showed a photo of Wendy's fast-food restaurant founder Dave Thomas.

Thomas became a household name in the U.S. in the 1990s while starring in hundreds of the company's TV commercials.

The caption of the ads in question read, "Closing Time: All The Restaurant Chains Closing." They appeared to hint that Wendy's would be closing down its entire restaurant chain, going bankrupt or going out of business for other reasons.

A rumor in Facebook and Instagram ads claimed that Wendy's was going to be closing all restaurant locations, going out of business or going bankrupt.
A rumor in Facebook and Instagram ads claimed that Wendy's was going to be closing all restaurant locations, going out of business or going bankrupt.

These were two versions of the ads that ran in late 2023.

Users who clicked on the ads with the Wendy's-themed photo of Thomas were led to one of two articles.

In one lengthy, list-style article hosted by Investing.com, the headline read, "Last Call: You May See Fewer of These Restaurant Chains in 2023." Wendy's appeared in the story at number 44 out of 123 restaurants, with a paragraph that began with, "Wendy's itself is not going out of business":

44. Wendy’s

Year Established: 1969

Headquarters: Dublin, Ohio, United States

Wendy’s itself is not going out of business, but the restaurant’s biggest franchisee operator, NPC International, sadly is. NPC International operates 385 Wendy’s in the US, meaning that the future of those stores is now in serious jeopardy. NPC also operates over 1,225 Pizza Huts in America.

NPC filed for Chapter 11 in July of 2020, citing  $903 million in debt. NPC tried to sell off 900 Pizza Huts to Yum! Brands to pay off some of the debt, but Yum! Brands backed out of the deal, citing concerns that creditors would snatch the locations up before they got the chance to move in.

The article only ended up revealing that a franchisee named NPC International had sold its Wendy's restaurants to another operator. The sale was approved by a judge in 2021, according to RestaurantBusinessOnline.com, meaning this was old news.

A second article attached to some of the Facebook and Instagram ads led to sportzbonanza.com. The story's headline read, "Classic Fast Food Restaurants That Are Gone for Good." However, Wendy's was not mentioned in the article. Also, the story was dated Oct. 14, 2020, which again also made this article old news.

The reason why these kinds of ads exist on Facebook and Instagram along with their lengthy articles is usually for something called advertising arbitrage. Advertising arbitrage is a strategy by which an advertiser hopes to make more money on ads displayed in a lengthy article than it would cost to display an initial clickbait ad meant to attract users to the article.

Since both articles were at least two years old, we wouldn't be surprised to see these misleading ads continuing to appear well in the 2024 calendar year, and perhaps beyond.

Sources:

“Dave Thomas - Wendy’s, Daughter & Facts.” Biography, https://www.biography.com/business-leaders/dave-thomas.

Liles, Jordan. “Snopes Tips: How To Avoid Ad Arbitrage Clickbait.” Snopes, 2 Jan. 2022, https://www.snopes.com/articles/387913/avoid-ad-arbitrage-clickbait/.

Maze, Jonathan. “Bankruptcy Court Approves the $801M Sale of NPC International.” RestaurantBusinessOnline.com, 21 Jan. 2021, https://restaurantbusinessonline.com/financing/bankruptcy-court-approves-801m-sale-npc-international.