March 3, 2010 4:01 PM
- Text
Starbucks To Close 600 Stores In 2009
(AP)
Starbucks Corp. said Tuesday it will close 600 company-operated U.S. stores in the next year, up dramatically from its previous plan for 100 closures, a sign the coffee shop operator is still feeling the pain from the faltering U.S. economy.
Starbucks said in a statement that 70 percent of the stores to be closed were opened after the start of 2006. The locations set to close include ones that "were not profitable and not projected to provide acceptable returns in the foreseeable future," it said.
About 12,000 workers will be affected by the closings, which are expected to take place over the next year, according to Valerie O'Neill, a spokeswoman for the company.
O'Neill said most of the employees will be moved to nearby stores, but she did not know exactly how many jobs will be lost.
The company predicted related charges will add up to $328 million to $348 million, but said that after income tax benefits and other changes, it expects to pay about $100 million.
Starbucks also cut the number of company-operated stores it will open in fiscal 2009 in half, to fewer than 200. The company did not adjust its plan to open fewer than 400 stores in 2010 and 2011.
In May, Starbucks said its second-quarter profit sank 28 percent as U.S. consumers cut back on visits in light of rising food and gas prices.
As of the end in March, there were 16,226 Starbucks stores around the world, including 7,257 company-operated stores in the U.S.
Starbucks said in a statement that 70 percent of the stores to be closed were opened after the start of 2006. The locations set to close include ones that "were not profitable and not projected to provide acceptable returns in the foreseeable future," it said.
About 12,000 workers will be affected by the closings, which are expected to take place over the next year, according to Valerie O'Neill, a spokeswoman for the company.
O'Neill said most of the employees will be moved to nearby stores, but she did not know exactly how many jobs will be lost.
The company predicted related charges will add up to $328 million to $348 million, but said that after income tax benefits and other changes, it expects to pay about $100 million.
Starbucks also cut the number of company-operated stores it will open in fiscal 2009 in half, to fewer than 200. The company did not adjust its plan to open fewer than 400 stores in 2010 and 2011.
In May, Starbucks said its second-quarter profit sank 28 percent as U.S. consumers cut back on visits in light of rising food and gas prices.
As of the end in March, there were 16,226 Starbucks stores around the world, including 7,257 company-operated stores in the U.S.
Latest Now in MoneyWatch
- Ohio unemployment hits 3-year-low
- Jill on Money: Retirement investing, allocation, long term care
- Could "web-lining" be dangerous?
- Insurers respond cautiously to contraceptive plan
- Judge: Legally, breastfeeding not related to pregnancy
- Budget deficit drops to $27 billion in January
- Why the Powerball Jackpot is part of my investment strategy
- Is the new VW Beetle diesel worth the money?
- Consumer sentiment highlights risks to recovery
- Valentine blues? 10 best cities to be single
- December trade deficit widens to $48.8 billion
- Alcatel-Lucent returns to profit in 2011
- 6 things never to say in a performance review
- $26B mortgage deal: Who gets the money?
- Friendly's CEO steps down
- Quarterly loss hits $3.3B at Postal Service
- Greeks rail against cuts as EU demands more
Latest CBS News Headlines
on Facebook Most Discussed Stories
on CBS News
- Brazil jet makes forced stop after pilot attack
- Love beats action as 'The Vow' bows with $41.7M
- Victoria Beckham back to sexy, sophisticated form
- Top Republican wants vote on birth control mandate
on Facebook Most Discussed Stories
on CBS News
