Starbucks to close 150 U.S. cafes to combat slowing growth

Darnell Taylor
June 20, 2018

The company will triple its traditional annual average of closing about 50 stores as part of a streamlining effort including rapidly optimizing its US store portfolio.

Starbucks announced Tuesday that it is closing 150 of its US stores in the next year, three times as many as the chain normally closes in that time period.

In March, Rosalind Brewer, Starbucks' COO, also said the market for vegan food was significant and that the company was working on launching more plant-based food and drinks.

Starbucks shares slipped almost 2 percent in after-hours trading.

Johnson laid blame for the disappointing sales growth at the feet of the once-vaunted Frappuccino, which accounted for 14 percent of revenue at company-operated stores as recently as three years ago.

German, French leaders meet to mold plans for EU's future
But Merkel says Seehofer's unilateral measure would leave countries at the EU's southern periphery alone to deal with the influx. President Trump is pointing to Europe's massive migrant crisis as the reason open border policies do not work.

The company said comparable sales growth at existing stores, a key measure of retail performance, was expected to be just 1 percent in the current quarter, despite a booming economy and a broadly healthy restaurant industry.

"Our recent performance does not reflect the potential of our exceptional brand and is not acceptable", CEO Johnson said in the statement.

Starbucks' Executive Chairman Howard Schultz stepped away from the company in June surprising investors at time when the company has faced raft of worrying headlines.

Starbucks shares are virtually unchanged for the year.

The coffee chain, which is still shaking off the backlash caused by the arrest of two black men in a Philadelphia store that led to the chain shutting down its stores for sensitivity and bias training, says it's pulling back new store launches in urban areas where coffee chains are abundant. The overall number of stores will continue to increase, but that growth will be focused.

Other reports by

Discuss This Article