Starbucks to close 150 stores whose sales aren't up to snuff

21 June, 2018, 00:29 | Author: Sheri Evans
  • Starbucks says it will close 150 poorly performing stores next year

He also pointed to the impact of the company's response to the April arrest of two black men in a Philadelphia store, including the May 29 afternoon closure of 8,000 USA stores for anti-racial bias training.

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

Stifel pulled its target price down slightly, to $55, just a bit above current levels.

In early May, Swiss-based Nestle (NESN.S) said it would pay Starbucks $7.15 billion for exclusive rights to sell Starbucks coffees and teas. Stock for the company dropped as much as 5 percent in after-hours trading.

Earlier this month, Howard Schultz stepped down as president, which fueled reports that he was gearing up for a 2020 presidential run. That's their lowest quarterly growth since 2009, reported.

"We lost momentum", Johnson said in a presentation to analysts at the Oppenheimer Consumer Conference on Tuesday. Maw said the company is bringing in an outside consulting firm to find cost savings, which Starbucks hopes to realize as soon as its fourth quarter.

The Seattle-based company said it will close about 150 stores in fiscal 2019 in its most densely penetrated markets, 100 more than its historical average. store growth peaked at 6 percent in Starbucks' 2017 fiscal year. That alliance frees Starbucks to focus on improving its mainstay US cafe business, where traffic growth had stalled. "It is not an excuse", for the 1 percent growth rate, he added.

For a chain that has so many stores that they often in sight of each other, Starbucks said Tuesday is finally ready to pull the plug on more of its losers.

The chain, which operates more than 8,000 USA stores, said the changes were made to address the weaker-than-expected sales growth, adding that several digital initiatives were expected to add 1% to 2% in comparable sales in fiscal 2019.



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