Gumleaf
July 29th, 2008, 06:07 AM
17:00 AEST Tue Jul 29 2008
Starbucks will close 61 of its Australian stores within days, leaving 685 employees out of a job.
Just 23 Starbucks stores will remain in Australia and axed outlets will open for the last time this Sunday.
Starbucks employees were notified of the decision at meetings across the country today after stores were ordered to shut down at 2pm.
The company recently announced it would close 600 stores in the US and shed 12,000 jobs. There are currently 84 stores open in Australia.
The first Starbucks outlet in Australia near Sydney's Hyde Park opened with a flurry of publicity back in 2000, but when ninemsn went there this afternoon the shop was deserted.
A statement from the company said Australia was the only market outside the US that would be affected by store closures and job losses.
The company will now focus its resources on Sydney, Melbourne and Brisbane, meaning stores in regional areas, South Australia and Tasmania will be among those scrapped.
The statement quoted Starbucks CEO Howard Schultz, who called the decision "difficult but necessary".
A list of affected stores will be published by July 31, after all the employees are informed.
As part of the restructuring, Starbucks Australia store development manager Jason Ball will become managing director from September 1.
Starbucks has struggled recently, with its share price trading at a high of US$14.57 and a low of $US14.07 overnight, more than 25 percent down this year alone.
About 70 percent of the stores slated for closure in the US have opened since the beginning of fiscal 2006.
The company has blamed poor real estate decisions, coupled with a troubled US economy, for the closures.
But other critics say Starbucks has surrendered its reputation in the US through an excess of peripheral products and a lack of focus on quality coffee.
Starbucks will close 61 of its Australian stores within days, leaving 685 employees out of a job.
Just 23 Starbucks stores will remain in Australia and axed outlets will open for the last time this Sunday.
Starbucks employees were notified of the decision at meetings across the country today after stores were ordered to shut down at 2pm.
The company recently announced it would close 600 stores in the US and shed 12,000 jobs. There are currently 84 stores open in Australia.
The first Starbucks outlet in Australia near Sydney's Hyde Park opened with a flurry of publicity back in 2000, but when ninemsn went there this afternoon the shop was deserted.
A statement from the company said Australia was the only market outside the US that would be affected by store closures and job losses.
The company will now focus its resources on Sydney, Melbourne and Brisbane, meaning stores in regional areas, South Australia and Tasmania will be among those scrapped.
The statement quoted Starbucks CEO Howard Schultz, who called the decision "difficult but necessary".
A list of affected stores will be published by July 31, after all the employees are informed.
As part of the restructuring, Starbucks Australia store development manager Jason Ball will become managing director from September 1.
Starbucks has struggled recently, with its share price trading at a high of US$14.57 and a low of $US14.07 overnight, more than 25 percent down this year alone.
About 70 percent of the stores slated for closure in the US have opened since the beginning of fiscal 2006.
The company has blamed poor real estate decisions, coupled with a troubled US economy, for the closures.
But other critics say Starbucks has surrendered its reputation in the US through an excess of peripheral products and a lack of focus on quality coffee.