Starbucks Closing 600 Stores

by Darren

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Starbucks (SBUX) has announced they’re closing 600 stores nationwide and laying off 12,000 workers in an effort to boost profitability. It’s a sign that America’s insatiable thirst for overpriced coffee has a limit, especially when gas costs over $4 per gallon. With a Starbucks already on every corner, the Seattle-based company has been forced to do a reality check about their operations.

The 12,000 workers who are losing their jobs represent 7% of Starbuck’s global workforce.

Investors seem to be applauding the decision. The stock has risen steadily since the decision was made.

The growth of Starbucks has been criticized by many analysts. If you’ve traveled to Las Vegas in recent years, you couldn’t help but notice that there are Starbucks locations everywhere you turn. This is true in many other cities, as well. The closures will cost the company $348 million.

Starbucks isn’t dumping the idea of growth, though.

“We believe we still have opportunities to open new locations with strong returns on capital,” CFO Pete Bocian said.

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