Medifast Inc. will close eight underperforming weight control centers at the end of the year.
The Owings Mills weight loss company plans to close the centers, located in Florida, Texas and Virginia, as part of an effort to transition many of its 83 corporate-owned centers to franchises. Thirty-six Medifast Weight Control Centers nationwide are already franchise-owned.
The company also plans to sell the assets of between 10 and 15 additional weight control centers to an existing business partner in the first half of 2014. Medifast (NYSE: MED) has not yet announced the locations of those centers.
“The closure of these centers and this initial transition of centers to the franchise model are consistent with our long-term strategy to better position the Medifast Weight Control Center sales channel for profitable growth,” CEO Michael MacDonald said in a statement. “We will continue our efforts to identify new franchise partners and continue to invest resources in the remaining corporate centers during the transition period.”
Medifast first announced the franchise transition in August. The move will allow the company to “optimize franchise performance, heighten focus on franchise location expansion with both existing and new franchise partners, and provide a strong foundation for future growth and profitability,” a spokeswoman said in a statement Friday.
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