Starbucks exits another business

starbucks coffee sign

After closing its Teavana tea cafes, Starbucks is shutting down the retail component of the business as well, with plans to close all 379 Teavana retail stores within a year.

“Many of the company’s principally mall-based Teavana retail stores have been persistently underperforming,” the company said this afternoon in releasing financial results for the quarter ended July 2. “Despite efforts to reverse the trend through creative merchandising and new store designs, the underperformance was likely to continue.”

Instead, it continued, the chain will be shut down, with most of the closings coming by next spring.

Starbucks said it will try to absorb the 3,300 employees working in the stores into the beverage giant’s other operations.

The coffee chain posted a domestic same-store sales gain of 5% for the quarter, noting that virtually all of the gain came from an increase in average ticket rather than from a rise in traffic.

Members help make our journalism possible. Become a Restaurant Business member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.

Multimedia

Exclusive Content

Food

Taco John's travels back to its 'West-Mex' roots to spice up the menu

Behind the Menu: Starting with its new Fiesta sauce and maximizing what’s already stocked in the pantry, the Mexican fast-food chain is driving flavor throughout its platform.

Financing

'The world needs Starbucks:' How Brian Niccol plans to revive the coffee chain

The Starbucks CEO detailed his “Back to Starbucks” plan to 14,000 cheering leaders of the coffee shop giant in Las Vegas this month. And he said the effort is important far beyond the company.

Financing

In the fast-food world, growth is coming from drinks and desserts

The Bottom Line: The highest-growth quick-service chains cannot be found in traditional sectors but among coffee, beverage and dessert brands. What does this say about the restaurant industry?

Trending

More from our partners