Starbucks Coffee Australia has reported a financial loss of $5.8 million for the last fiscal year, according to newly filed documents. This setback raises concerns about the coffee chain's ability to attract Australian consumers amid rising living costs.
The Australian operation, licensed by the Withers family, acknowledged in a statement that it is committed to revitalizing the Starbucks brand despite facing significant macroeconomic challenges. The company emphasized its focus on enhancing customer experience, store design, and product innovation.
Michael Smith, chair of Starbucks Australia, noted that while the loss is disappointing, the primary objective remains growth. The company plans to operate over 100 stores in Australia by next year, expanding its drive-through network.
Despite a decline in customer traffic, the overall demand for coffee remains strong, with Australian home appliance manufacturer Breville seeing record sales in coffee machines. Starbucks aims to adapt its menu and pricing strategy to better meet consumer needs, following a trend of offering bundled deals in other markets.
Starbucks' performance reflects broader challenges faced by the company, including declining sales and profits in the US and China, prompting new CEO Brian Niccol to simplify the menu and adjust pricing strategies.