Starbucks hit a roadblock trying to export its business model to Australia, a robust coffee culture where customers already knew the difference between a macchiato and an affogato, local traders say.
The US giant announced last week that it would close 61 of its 84 Australian outlets by yesterday, saying “challenges unique to the Australian market” were behind the decision, which cost almost 700 jobs.
The statement from Starbucks’ head office in Seattle did not say what made Australia different, but did point out: “There are no other international markets that need to be addressed in this manner.”
Starbucks Asia Pacific president John Culver was more forthcoming about why the company was on the retreat in Australia, eight years after opening its first store in Sydney.
“I think what we’ve seen is that Australia has a very sophisticated coffee culture,” he said in a newspaper interview.
A wave of post-war immigrants from Turkey, Greece and Italy means that for decades Australians had been enjoying the “coffee experience” Starbucks virtually created from scratch in the US.
Both Sydney and Melbourne have Italian enclaves lined with cafes where old men sip espressos at outdoor tables through the day and trendy young couples gather in the evening for a caffeine fix.
Starbucks’ idea of making itself a “third place” in customers’ lives between home and work was a novelty in the US, where in many small towns cafe culture consisted of filter coffee on a hot plate.
But Melbourne cafe owner Jeremy Jenkins said the situation was different in Australia, where baristas have been plying their trade at steaming espresso machines since the 1950s.
“People come in our cafe because they know us and they know they’ll get good coffee, we’re part of the local community,” he said.
“Starbucks is a McDonald’s coffee experience. It’s not about the quality of the coffee, it’s about convenience and location,” he said.
Starbucks also closed 600 stores in the US early last month in a move widely seen as a response to belt-tightening among customers less inclined to spend money on luxuries like coffee in tough economic times.
Commentators have suggested similar problems hit Starbucks in Australia, but the lines outside the Met Cafe in central Sydney on a recent windy winter’s day indicated many customers were not yet ready to sacrifice their coffee hit.
Met Cafe owner Brendan Smart said Starbucks had expanded too quickly in Australia.
“A few years ago there weren’t that many of them and they seemed to be going OK, but then all of a sudden, they were everywhere,” he said. “Some city blocks had three Starbucks on them — it’s crazy.”
Smart said many customers had told him they did not want to buy their coffee from a corporate giant and those who had tried Starbucks were not impressed by the product, saying it did not compare with the numerous local brews available.
“What we do isn’t rocket science, I’m the first to admit that, but you’ve got to have a passion for coffee that involves everything from grinding the beans to operating the machine,” he said. “You go into Starbucks and it’s full of teenagers behind the counter. I’d question whether they have that passion.”
Starbucks now plans to streamline its operation to 23 stores in Australia’s largest cities Sydney, Melbourne and Brisbane.
ROLLER-COASTER RIDE: More than five earthquakes ranging from magnitude 4.4 to 5.5 on the Richter scale shook eastern Taiwan in rapid succession yesterday afternoon Back-to-back weather fronts are forecast to hit Taiwan this week, resulting in rain across the nation in the coming days, the Central Weather Administration said yesterday, as it also warned residents in mountainous regions to be wary of landslides and rockfalls. As the first front approached, sporadic rainfall began in central and northern parts of Taiwan yesterday, the agency said, adding that rain is forecast to intensify in those regions today, while brief showers would also affect other parts of the nation. A second weather system is forecast to arrive on Thursday, bringing additional rain to the whole nation until Sunday, it
LANDSLIDES POSSIBLE: The agency advised the public to avoid visiting mountainous regions due to more expected aftershocks and rainfall from a series of weather fronts A series of earthquakes over the past few days were likely aftershocks of the April 3 earthquake in Hualien County, with further aftershocks to be expected for up to a year, the Central Weather Administration (CWA) said yesterday. Based on the nation’s experience after the quake on Sept. 21, 1999, more aftershocks are possible over the next six months to a year, the agency said. A total of 103 earthquakes of magnitude 4 on the local magnitude scale or higher hit Hualien County from 5:08pm on Monday to 10:27am yesterday, with 27 of them exceeding magnitude 5. They included two, of magnitude
CONDITIONAL: The PRC imposes secret requirements that the funding it provides cannot be spent in states with diplomatic relations with Taiwan, Emma Reilly said China has been bribing UN officials to obtain “special benefits” and to block funding from countries that have diplomatic ties with Taiwan, a former UN employee told the British House of Commons on Tuesday. At a House of Commons Foreign Affairs Committee hearing into “international relations within the multilateral system,” former Office of the UN High Commissioner for Human Rights (OHCHR) employee Emma Reilly said in a written statement that “Beijing paid bribes to the two successive Presidents of the [UN] General Assembly” during the two-year negotiation of the Sustainable Development Goals. Another way China exercises influence within the UN Secretariat is
Taiwan’s first drag queen to compete on the internationally acclaimed RuPaul’s Drag Race, Nymphia Wind (妮妃雅), was on Friday crowned the “Next Drag Superstar.” Dressed in a sparkling banana dress, Nymphia Wind swept onto the stage for the final, and stole the show. “Taiwan this is for you,” she said right after show host RuPaul announced her as the winner. “To those who feel like they don’t belong, just remember to live fearlessly and to live their truth,” she said on stage. One of the frontrunners for the past 15 episodes, the 28-year-old breezed through to the final after weeks of showcasing her unique