Page last updated at 09:32 GMT, Thursday, 12 June 2008 10:32 UK

Starbucks set to expand in Europe

Starbucks store
Starbucks hopes to grow overseas as Americans tighten their belts

US coffee chain Starbucks is to open more outlets in Europe after signing a licensing partnership.

The deal with food operator SSP will see more than 150 Starbucks stores opened in airports and railway stations over the next three years.

The move comes as Starbucks seeks to offset a slump in the US market with increased growth in Europe.

In November, Starbucks reported its first quarterly decline in US customer traffic to its stores.

The decline has continued, forcing the chain to think of more innovative products and look overseas for future growth prospects.

Starbucks chairman and chief executive Howard Schultz said he was confident the deal would consolidate Starbucks' presence in Europe, including key markets Germany, the UK and France.

"This collaboration aligns with our strategy to accelerate growth in our international business," said Mr Schultz.

"It provides us with a strong platform to further expand the Starbucks brand across Europe."

Growth problems

In November, the company cut its sales and earnings forecasts saying higher food and energy costs would trigger a drop in the number of Americans buying lattes and espressos.

It also said it would open 2,500 stores in its 2008 financial year, 100 fewer than its original target.

Starbucks opened its first coffee shop in Argentina earlier this month through a Mexican partnership.

Mr Schultz conceded that Starbucks' focus had been "primarily on the US business" but the company's deal with SSP represented a "broader opportunity".

In January, Starbucks sacked its chief executive Jim Donald and handed the reins back to Mr Schultz, who had formerly been the firm's chief executive.




SEE ALSO
Bitter 2008 brewing for Starbucks
15 Nov 07 |  Business
Starbucks reports falling profits
30 Apr 08 |  Business
Starbucks turns to customer ideas
09 Apr 08 |  Business

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