Iconic US coffee chain Starbucks said today it would shut most of its Australian stores within a week, having already taken the axe to hundreds of US outlets as an economic downturn bites.
The company said it would shut 61 'underperforming' stores from a total 84 in Australia because it was refocusing to concentrate on the major cities of Sydney, Melbourne and Brisbane and surrounding areas.
The coffee chain did not detail how many jobs would be lost, although media reports put the figure at 685.
Starbucks said earlier this month that it would shut 600 US stores in a move widely taken to reflect the slowdown in the world's biggest economy, where high fuel prices and a credit crunch are forcing consumers to tighten their belts.
The giant coffee chain's chairman, Howard Schultz, said the firm had developed a transformation plan in January that had led to the 'difficult but necessary' decision to close stores in Australia.
Schultz said the decision to shut the stores reflected problems specific to the country and did not reflect 'the strong state of Starbucks business in countries outside of the US.' 'There are no other international markets that need to be addressed in this manner,' he said.
Starbucks opened its first Australian store in 2000 but faced competition in some of the country's more cosmopolitan cities from an existing cafe culture.