Starbucks closes 75% of Australian stores!

According to The Age, Starbucks are closing 61 out of their 85 Australian stores. It seems they have all but given up on the Australian market.

I’m not surprised they’re struggling here. Unlike the United States, Australia has a long-running coffee culture. Before the arrival of Starbucks, there were already thousands of independent coffee shops, to the point where they comprised 1/3 of retail outlets in some suburbs (or so it seemed). Some of these focussed more on food than they did coffee, but there were plenty of others that served a decent brew. Australia has heaps of coffee snobs as a result.

Not everyone is a coffee snob, of course, so Starbucks might still have made inroads into the market had they moved a bit faster. Unfortunately for them, they spent several years taking over the US first, and while they did so, some enterprising souls noticed how profitable they were, and set about replicating that success here. Soon, Australian shopping centres were filled with Starbucks clones. The most successful of these, Gloria Jeans, now has a huge fanbase that won’t go anywhere else.

As a result, the entry of  Starbucks into the Australian market was met with a collective “meh” from the local population.

They might still have gotten somewhere had their coffee tasted good, but in my humble opinion, they are beaten not only by the independents but most (if not all) the other chains.

The lesson for business owners? If you are successful in one market, make sure to conquer the others quickly, or someone else will beat you to it.