Burger King is pursuing a refranchising initiative to accelerate its U.S. turnaround, planning to divest approximately 200 company-operated locations by the end of the year. The burger chain’s parent company, Restaurant Brands International, acquired major franchisee Carrols Restaurant Group in 2024 for roughly $1 billion, adding over 1,000 locations to its corporate holdings. The long-term goal is to maintain approximately 300 company-operated restaurants while franchisees operate the remainder of Burger King’s more than 6,000 U.S. locations.
The refranchising strategy reflects Burger King’s broader turnaround effort that began in late 2022, focusing on marketing improvements, food quality enhancements, and restaurant renovations. Recent results suggest the strategy is working, with Burger King recently surpassing Wendy’s to become the second-largest burger chain by system sales. In its latest quarter, domestic same-store sales grew 8.5%, significantly outpacing competitor McDonald’s at 0.8%. Restaurant Brands’ stock has risen approximately 6% over the past year, though it remains substantially smaller by market capitalization than rivals.
The chain is prioritizing a new type of franchisee: smaller, local operators with deep community ties rather than large private-equity-backed firms. Burger King President Tom Curtis emphasized the importance of finding operators committed to long-term success and personally invested in their restaurants’ performance. Former Burger King franchising director Jeremy Kline exemplifies this shift, having purchased 16 Salt Lake City locations in February after previously struggling to sell them while in a corporate role. The company is also recruiting from its own ranks and sister chains, including Tim Hortons employees who have signed agreements.
A key bottleneck in the refranchising process is ensuring that prospective franchisees are suitable long-term partners. Burger King initially targeted selling approximately 300 locations this year but revised expectations downward to 200, reflecting the thoroughness of its vetting process. The company plans to complete the Carrols refranchising over the next seven years following the 2024 acquisition closing. Industry analysts note that franchisee-operated locations typically perform better than company-run restaurants, positioning refranchising as potentially accretive to earnings and supporting further cash investment in restaurant improvements.
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