Starbucks still at a loss in UK
21 May, 2012
Starbucks made a loss in the UK for a fifth successive year in 2011, says the Independent on Sunday, blaming high rents and royalty payments to the US.
It says Starbucks reported a £32.9m loss for the year to September 2011. The company has not made a profit in the UK since 2006, despite posting 11 consecutive quarters of like for like sales growth.
Starbucks closed 12 sites and opened 42 in the UK in 2011. It said it was closing less profitable branches or relocating them to adjacent locations, as on London’s Oxford Street this year.
UK managing director Kris Engskov said the company was “making strides” to improve its bottom line. Sales of lattes have meanwhile run 9% ahead this year following a promo that saw it give away 350,000 free cups in a morning in March. “It has been remarkably powerful,” said Engskov.
For the full story, see Rents grind down Starbucks.