As Carl’s Jr. faces the closure of up to 24 locations in Australia, the fast-food chain is planning a comeback, focusing on strategic sites like the recently opened store in Tarneit. The brand’s efforts come amid intense competition from industry giants like McDonald’s, Hungry Jack’s, Domino’s, and KFC, all vying for dominance in Australia’s highly competitive fast-food market.
Market experts warn that the closure of these Carl’s Jr. locations presents a risky gap in the market. With these prime spots soon to be vacated, there’s a strong possibility that competitors will move quickly to take over. According to an industry insider, established brands like McDonald’s, Hungry Jack’s, and KFC are always on the lookout for opportunities to expand, and the rising costs of opening new stores might make them keen to snap up the valuable sites left by Carl’s Jr.
“They’re in some pretty good locations,” the source noted, suggesting that competitors may be tempted to occupy these soon-to-be-available spaces.
“Rents have been increasing, with tenants offering more to secure prime locations. This is largely due to the skyrocketing costs associated with building new stores. Construction costs are through the roof,” the source explained.
Despite the setback of its Australian master licensee entering voluntary administration, which affects 24 stores, Carl’s Jr.’s parent company, CKE, remains determined to grow its presence in Australia. A spokesperson for CKE emphasized that Australia continues to be a crucial market for the brand.
“Despite global challenges like inflation, supply chain issues, and changing consumer behaviors, CKE is still committed to Australia. The country offers significant opportunities for growth,” the spokesperson said.
Currently, 25 Carl’s Jr. restaurants, including the new Tarneit location, are still operating across New South Wales, Victoria, South Australia, and Queensland. The brand has plans to expand further, hoping to add more locations in the near future.
Carl’s Jr. positions itself at a middle price point among fast-food options in Australia.
“They’re priced higher than the standard options like McDonald’s but are still cheaper than premium chains like Grill’d,” the industry insider commented.
The source also pointed out the strong performance of Hungry Jack’s last year, questioning why Carl’s Jr. struggled in comparison. “It makes you wonder—maybe it’s just taking them longer to gain momentum, achieve economies of scale, and become profitable.”
The Tarneit store, which opened just before the administration notice, remains a critical location in Carl’s Jr.’s strategy to expand and solidify its footprint in Australia.