Starbucks is Closing Stores - Now Only 3 on Every Block
These guys are going to have the worst real estate problem in the US....
Starbucks Corporation (NASDAQ: SBUX) has announced the next step in its multi-faceted plan to transform the company, with a decision to close approximately 600 underperforming company-operated stores in the U.S. market. This decision is a result of a rigorous evaluation of the U.S. company-operated store portfolio and includes the 100 stores targeted for closure in the company’s previously announced plans. In addition, Starbucks now expects to open fewer than 200 new U.S. company-operated stores in fiscal 2009.
The majority of the store closures are scheduled to occur during the remainder of fiscal 2008 and the first half of fiscal 2009. The timing of the closures is dependent on finalizing third-party agreements, and is therefore subject to change. Both full-time and part-time retail positions will be eliminated, however the company expects to place many of the affected partners (employees) into available positions at nearby Starbucks stores.
“In January, we committed to transforming the company through a series of critical and strategic initiatives to improve the current state of our U.S. business and build the business for the long term,” stated Howard Schultz, chairman, president and ceo. “Our executive and field leadership teams conducted an extensive review of our U.S. company-operated store portfolio with a goal of enabling our organization to focus its efforts on locations where we can more effectively improve the customer experience.”
“Throughout the history of the company, we have always aspired to put our people first. This makes our decision to close stores difficult, because it is disrupting the lives of the people who have worked so hard to deliver superior service to our customers,” Schultz continued. “We sincerely thank each one of them and are very proud of their many contributions to the company. At the same time, we recognize that it is necessary to make decisions that will strengthen the U.S. store portfolio and enable us to enter into fiscal 2009 focused on enhancing operating efficiency, improving customer satisfaction and ensuring long-term value for our partners, customers and shareholders.”