Carl’s Jr. Glendale Store to Remain Open Amid National Shake-Up

30 July 2024

In a significant development for the Australian fast-food industry, CARL’S JR.’s Australian operations have entered voluntary administration. The GLENDALE outlet, located in the Lake Macqarie LGA, will continue to trade as it is independently owned, the store will transition to a direct licensed relationship with CKE Restaurants Holdings, Inc. (CKE), the parent company of Carl’s Jr., with minimal changes expected.

The Glendale store’s continued operation is a bright spot amid a challenging period for the brand in Australia. The announcement came after CJ’s Group, the master licensee for Carl’s Jr. in the country, appointed KPMG’s David Hardy, George Georges, and Emily Seeckts as administrators. The group independently owns and operates 24 Carl’s Jr. restaurants across the country, with 20 set to close immediately. The closure affects hundreds of employees and leaves only four stores under CJ’s Group’s direct operation.

The stores not directly operated by CJ’s Group, totaling 25, are owned and operated by third-party sub-licensees. These locations will transition to a direct licensing arrangement with CKE, ensuring minimal disruption to their operations. This move comes as Carl’s Jr. Australia grapples with the broader economic pressures affecting the hospitality industry, including rising costs and a downturn in consumer spending.

Carl’s Jr. had ambitious plans for the Australian market, aiming to open 300 stores since its first establishment in Bateau Bay, NSW, in 2016. The chain quickly expanded to include locations in Queensland, Victoria, South Australia, and New South Wales. However, the company struggled to position itself against local competition, and the rising cost-of-living crisis exacerbated its challenges.

The administrators have taken over day-to-day control of the company and are currently conducting an assessment of the business. An immediate sale process for the existing store network is underway, with all stakeholders, including employees, suppliers, and landlords, to be contacted in the coming days. A creditors’ meeting is scheduled for August 7, where more details are expected to emerge.

While the administration of the Australian stores does not affect Carl’s Jr. locations overseas, the news marks a significant setback for the brand’s expansion plans in the region. The Glendale store’s survival, however, offers a glimmer of hope for fans of the chain in Newcastle, ensuring that at least one local outlet will continue to serve the brand’s signature burgers and sides.

As the situation develops, the focus remains on stabilising the operations and finding a sustainable path forward for the remaining stores. The Glendale store’s transition to direct licensing with CKE Restaurants Holdings, Inc. signifies a strategic effort to maintain a foothold in the Australian market amidst challenging times.