Starbucks to close 150 US stores

Starbucks plans to shutter 150 underperforming stores in highly concentrated U.S. markets as part of a new operational strategy.

The closures, set to take place in 2019, are up considerably from the average 50 stores the coffee and beverage chain historically has closed each year. Starbucks plans to offset some of the closures by opening new stores in underpenetrated markets, but 2019 will still have a slightly lower growth rate in net new stores.

"While certain demand headwinds are transitory, and some of our cost increases are appropriate investments for the future, our recent performance does not reflect the potential of our exceptional brand and is not acceptable," Kevin Johnson, Starbucks president and CEO, said in a statement. "We must move faster to address the more rapidly changing preferences and needs of our customers."

The new strategy comes roughly two weeks after former Starbucks Executive Chairman Howard Schultz, who spent 40 years with the company, announced he would step down June 26. Shortly after the announcement, Starbucks raised the price of coffee across most of its 8,000-plus cafes in America by 10 to 20 cents, according to The Wall Street Journal.

More articles on business:
Walgreens to replace GE on Dow Jones Industrial Average
Musk accuses Tesla employee of 'extensive and damaging sabotage' campaign
Trump threatens tariffs on $200B more of Chinese goods as Dow reverses 2018 gains

© Copyright ASC COMMUNICATIONS 2019. Interested in LINKING to or REPRINTING this content? View our policies by clicking here.

 

Top 40 Articles from the Past 6 Months