Starbucks gets serious about increasing profitability: Starbucks announces it will close 600 stores.
The company, the world’s largest coffee chain, said Tuesday that it would close 600 stores in the United States beginning this year. It will lay off more than 12,000 employees in the process, the most in its history.
The plan builds on an earlier decision to close 100 stores, which are included in Tuesday’s numbers. Starbucks is retrenching in an effort to recapture the once-mighty growth it built upon venti soy lattes.
When I started reading Todd Sullivan’s blog ValuePlays a couple of years ago, he was harping about everything Starbucks was doing wrong and how they were losing to McDonald’s and Dunkin’ Donuts. The increase in commodity prices also contributed to the decline in profitability.
Now that Starbucks has its old leader, Howard Schultz, back, management might be able to turn things around a bit. Hopefully Starbucks will be able to return some lost value to shareholders. Just look at the chart…
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