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Starbucks Coffee International, a wholly-owned subsidiary of Starbucks Coffee Company (NASDAQ: SBUX), has announced plans to restructure its business in Australia through a geographical refocus on three core cities and surrounding areas: Brisbane, Melbourne and Sydney. This decision will result in the closure of 61 underperforming locations throughout the country by August 3, 2008.
After evaluating several options to strengthen the business in Australia, Starbucks made this decision to concentrate its attention and resources on profitable growth, operational efficiencies and an enhanced experience for customers and partners (employees) globally.
As part of the restructuring, Jason Ball, store development manager, Starbucks Australia, will assume the role of managing director effective September 1, 2008.
“In January 2008, we developed strategies to transform the company for the future,” said Howard Schultz, chairman, president and ceo, Starbucks Coffee Company. “Now, we are well into the implementation phase of transforming Starbucks and we believe that this difficult, yet necessary, decision to close stores in Australia will help support the continued growth of our international business.”
“While this decision represents business challenges unique to the Australian market, it in no way reflects the strong state of Starbucks business in countries outside of the United States,” continued Mr Schultz. “There are no other international markets that need to be addressed in this manner.”
Starbucks has been a part of the Australia market since 2000. There are currently 84 Starbucks locations throughout the country, including Brisbane, Canberra, Gold Coast, Melbourne, South Australia, Sydney, and Tasmania. 23 stores will remain open in Brisbane, Melbourne, Sydney and surrounding areas.
Starbucks says they will reach out to customers who are impacted by the store closures in a variety of ways including directing them to the website: www.starbucks.com.au and the Customer Care Hotline: 1800 140 408.
The list of stores that are scheduled for closure will be posted on www.starbucks.com.au and www.starbucks.com by July 31, 2008 after all affected store partners are informed of their store’s status.