With Schultz exiting, it’s now up to CEO Kevin Johnson to decide where to slow versus grow.
By Leslie Patton
June 19, 2018, 1:05 PM PDT
Americans’ long-running joke about a Starbucks on every corner may be nearing its end.
The coffee behemoth is retrenching in its home market as it contends with sales growth that Chief Executive Officer Kevin Johnson acknowledges isn’t fast enough. …
Starbucks also plans to close about 150 company-operated stores in densely penetrated U.S. markets next fiscal year, three times the number it historically shuts down annually. Shares initially slid as much as 6.3 percent in late trading Tuesday before inching back up. The stock was down 1.6 percent as of 5:24 p.m. in New York.
… With about 14,000 stores domestically, Starbucks is now pumping the brakes on licensed and company-operated locations, with a renewed focus on rural and suburban areas—not over-caffeinated urban neighborhoods where locals already joke that the next Starbucks will open inside an existing store.
“Over-caffeinated urban neighborhoods” is to 2018 what “vibrant urban neighborhoods” was to 2005.
The closing stores are often in “major metro areas where increases in wage and occupancy and other regulatory requirements” are making them unprofitable, Johnson said. “Now, in a lot of ways, it’s middle America and the South that presents an opportunity.”
… Schultz, who had already transitioned away from running the coffee chain’s day-to-day operations, announced earlier this month he’d be leaving the company, fueling speculation he could be gearing up for a political career.