According to reports, 50 of the 408 Starbucks locations nationwide have been temporarily closed by Berjaya Food, the company that runs Starbucks in Malaysia.
The Rakyat Post claims that the shutdown amounts to 12% of all Starbucks locations in Malaysia.
Starbucks Malaysia denied reports earlier this month that it was closing more than 100 locations nationwide. The company said in a statement to Business Times that it has ceased only a few stores, and “most of the allegedly closed locations are only temporarily closed”.
According to the spokesman, this is a component of their continuous evaluation to align their presence while guaranteeing that no job losses occurred. “Importantly, no employees have been affected by the permanent or temporary closures, as they have been reassigned to nearby stores to continue serving our customers seamlessly,” stated a spokeswoman.
However, the business has faced challenges in Malaysia. Due to brand boycotts in Malaysia brought on by the Middle East crisis, Berjaya Food, the company that runs the coffee chain there, had a loss in the fourth quarter.
Sales during the three months ending in June decreased by more than half, and the company experienced a net loss of RM38.2 million.
“The significantly lower revenue and pre-tax loss incurred in the current quarter under review were mainly due to the current sentiment in relation to the conflict in the Middle East,” Berjaya Food said in the report published at the tail end of August.
Due to the continuous boycott of Starbucks, Malaysia’s integrated financial services giant, RHB giant, reportedly released a research note in December of last year encouraging investors to sell their shares in Berjaya Food, the company that owns the franchise. According to reports, the bank saw a 24% decline in stock prices at the time.
Ground examinations of Starbucks locations revealed at least a 30% decrease in foot traffic the previous year, which prompted the recommendation. This is true even if retail malls are packed and the majority of Starbucks’ rivals see consistent foot traffic.
As RHB pointed out at the time, the food and beverage chain’s continued boycott because of its purported support for Israel in the ongoing Israel-Hamas war is to blame for the decline in foot traffic.
