Expansion Meets Obstacle

Pizza Hut's aggressive expansion plan, introducing its famous stuffed crust and pan pizzas to new markets in 2024, hit a snag with the sudden closure of 19 locations across two states. This development marks a significant contraction of its operational footprint, contrasting its otherwise nationwide growth.

Locations Hit by Closures

The shutdowns affected four locations in Central Ohio and 15 in Northwest Indiana. While the Ohio closures remain unexplained, the Indiana shutdowns stem from a legal tussle between Pizza Hut and one of its franchisees, the EYM Group, which is accused of financial delinquency.

Franchisee Financial Struggles

EYM Group, which operates 142 Pizza Hut outlets across five states, reportedly failed to meet its financial obligations to Pizza Hut, prompting the closures. The franchisee attributes its financial woes to rising operational costs, a lack of brand innovation, and other challenges, pushing it towards selling its Pizza Hut franchises.

Legal Battles Ensue

After entering a forbearance agreement in 2023, aimed at resolving the financial discord, Pizza Hut later terminated this agreement due to continued defaults by EYM Group. Subsequent lawsuits for breach of contract were filed by both parties, escalating the dispute into a legal confrontation.

Impact on Employees and Future Operations

The closure of the EYM Group-operated stores was publicly revealed after employees took to social media to announce their sudden unemployment. Despite these closures, Pizza Hut assures that these locations will not remain closed permanently, expressing a commitment to reopen many of the affected outlets under new management while maintaining operations in other regions.

Statement from Pizza Hut

In response to the closures, Pizza Hut has expressed its intention to ensure that the impacted locations in Indiana will resume operations soon, highlighting its dedication to serving its customers. The company reassures that other EYM Group-operated stores outside Indiana are still operational, directing customers to its website for information on open locations.

Locations Affected

The Indiana closures span several cities, including Portage, Valparaiso, and Merrillville, among others. Despite this setback, Pizza Hut continues to operate a substantial number of outlets across Indiana and Ohio, indicating the brand's resilience and ongoing presence in these states.