300 outlet expansion for Starbucks coffee chain

1st December 2011, 11:09am

Starbucks, the global coffee chain, is planning to open 300 new outlets in the UK over the next five years – to top 1000 stores - and employ 5,000 more people. A majority of new sites will be in the north of the country.

The move, after an aggressive expansion backfired in 2008, is at odds with other parts of the food and drink industry being forced to cutback as cash-strapped consumers curb spending and raw material inflation hits profit margins.

Starbucks' UK sales have grown for nine quarters in a row on a like-for-like basis although the group still lost £34.2 million at the net level in the year to the end of September 2010.

Kris Engskov, Starbucks managing director for the UK and Ireland,said: "Coffee is having its moment, just as wine did 25 years ago, where drinkers are discovering a taste for different varieties and an interest in the provenance of the product.

"This might be a better time than any to expand. Rents are coming down across the UK. If there's anything we've learnt over the last few years, especially in the US, it is to invest ahead of the curve."

Some 200 of the 300 planned new stores will be drive-through outlets. While big in the US, where Starbucks has 2,500, there are now just 10 such drive-throughs in the UK but, the chain says, customers are seeking more roadside cafes.

The coffee chain is teaming up with Euro Garages, the privately owned petrol station and forecourt retail group for the drive-through stores. It will in turn pay a royalty to Starbucks.

Related Articles:

• 20 Jul 2011 - Starbucks appoints new managing director for UK & Ireland
• 05 Oct 2010 - Starbucks puts food hygiene and customer service NVQs on the menu
• 08 Mar 2010 - Starbucks to launch VIA Ready Brew Coffee in the UK
• 10 Jan 2008 - Starbucks to open at Center Parcs sites

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