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Originally published Tuesday, July 29, 2008 at 12:00 AM

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Starbucks closing 73% of Australian stores

Starbucks will close 61 of its stores in Australia — 73 percent of the 84 stores there — as part of a turnaround strategy that...

Seattle Times staff writer

Starbucks will close 61 of its stores in Australia — 73 percent of the 84 stores there — as part of a turnaround strategy that includes closing 616 stores in the United States.

The company will have only 23 stores remaining in or near Brisbane, Melbourne and Sydney.

Starbucks will lay off 685 workers in Australia because of the closings, including in-store employees and administrative staff. The underperforming stores will close by Aug. 3.

These are the first international store closings that Starbucks has announced. Most of its financial woes, including declining traffic, appear to be in the U.S., and the company is shifting its focus to grow more quickly overseas than in the U.S. The 616 U.S. stores being closed make up about 5 percent of Starbucks' U.S. footprint

"While this decision represents business challenges unique to the Australian market, it in no way reflects the strong state of Starbucks business in countries outside of the United States," Chief Executive Howard Schultz said in a news release. "There are no other international markets that need to be addressed in this manner."

A list of stores scheduled to close in Australia is at www.starbucks.com.auand www.starbucks.com.

Melissa Allison: 206-464-3312 and mallison@seattletimes.com

Copyright © 2008 The Seattle Times Company

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