Mr Brown Coffee (伯朗咖啡) would close up to 10 of its coffeeshops nationwide, Chinese-language media reported yesterday, citing its operator, King Car Group (金車).
King Car would close the stores when their leases expire due to lower-than-expected profits, the United Daily News and Commercial Times reported.
The store in New Taipei City’s Tamsui District (淡水) is scheduled to close by the end of this month, they said.
However, the company would consider opening new stores in more suitable locations, the reports said.
Employees at the closing stores would either be transferred to other outlets or dismissed in accordance with the Labor Standards Act (勞基法), they said, citing King Car.
The company launched its series of canned Mr Brown Coffee products in 1982 and opened its first coffeeshop in 1998. At one time its had 46 shops nationwide.
It now has 39 stores, according to its Web site, following the closure of seven outlets in Taipei, including one in the Tianmu (天母) area more than a month ago, the reports said.
As market competition intensifies with the arrival of new brands and drink stalls, firstcomers are finding themselves under heavy pressure, H&B Business Group (住商不動產) head researcher Jessica Hsu (徐佳馨) said.
Convenience stores, which are constantly changing their marketing strategies, offer strong competition and might be another reason for the closure of Mr Brown Coffee shops, Knight Frank Taiwan researcher Andy Huang (黃舒衛) said.
Rising costs of ingredients, rent and labor are also pushing coffee shop operators out of the market, as most of them absorb the price increases instead of passing them on to their customer in fear of losing them, the news reports added.
King Car has sought to reposition itself in the domestic coffee shop market and slowly transformed Mr Brown stores to offer more food options such as light meals and snacks.
The company also operates the local Kavalan whiskey and Buckskin beer brands, as well as a range of soft drinks.
Ministry of Labor Department of Employment Relations Director Wang Hou-wei (王厚偉) yesterday told the Central New Agency that he had not received word from the company on a mass redundancy of workers, and was seeking clarification on whether the layoffs reached the legal threshold.
Additional reporting by staff writer and CNA
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