Starbucks Exits Australia After 14 Years

For over a decade, American coffee giant Starbucks battled to find its place in Australia—home to one of the world’s most sophisticated café scenes. Despite opening dozens of locations, the brand never quite won over local coffee drinkers. Now, after 14 years, Starbucks has officially exited the Australian market by selling its remaining 24 company-owned stores to local business The Withers Group.

In short: Starbucks is out of Australia. The company sold its last 24 company-run cafés to The Withers Group and signed a franchise deal, bringing its 14-year effort to adapt to Australia’s competitive coffee culture to an end. Previously, it had already closed 61 of its 87 stores back in 2008.

The Rise and Fall of Starbucks in Australia

Starbucks first landed in Australia in 2000, opening its flagship store in Sydney’s CBD. Buoyed by global expansion plans, the company rapidly grew to 87 locations across the country. But the rapid rollout didn’t translate into customer loyalty. By 2008, struggling with poor performance and mismatched expectations, Starbucks was forced to shut down 61 stores in a single year, leaving just 26 open.

Why Australians Didn’t Embrace Starbucks

Australia has long had a deeply rooted, high-quality coffee culture built around espresso-based drinks, especially flat whites and long blacks. Unlike the filtered and syrup-heavy offerings common in the U.S., Australian consumers preferred expertly crafted espresso shots and milk-based drinks made with precision. Starbucks’ standardized menu and large-format servings didn’t align with local tastes, and many customers saw the brand as inauthentic or overly commercial.

The Final Exit: 2024 Deal with The Withers Group

In its latest move, Starbucks sold its remaining 24 company-owned cafés to Australian firm The Withers Group. Alongside the sale, the companies entered into a franchise agreement. This marks the definitive end of Starbucks’ direct operations in Australia, though some franchised locations may continue under different ownership structures. The number of stores once peaked at 87 before the 2008 closures brought it down to 26.

What This Means for the Global Coffee Market

Starbucks’ retreat from Australia isn’t just a local story—it highlights the challenges global chains face when entering markets with well-established, locally driven café cultures. While the brand thrives in countries where coffee consumption is still developing, it has consistently struggled in nations like Australia, where customers value craftsmanship, regional traditions, and a more nuanced coffee experience.

Frequently Asked Questions

When did Starbucks first enter the Australian market?

Starbucks opened its first Australian store in Sydney’s CBD in 2000, as part of its global expansion strategy.

How many Starbucks stores were there in Australia at peak?

At its peak, Starbucks operated 87 stores across Australia before shutting down 61 locations in 2008.

Why did Starbucks close 61 stores in 2008?

In 2008, Starbucks closed 61 of its 87 Australian stores due to poor financial performance and difficulty competing with Australia’s established coffee culture.

Who bought Starbucks’ remaining Australian stores?

The Withers Group, an Australian company, purchased the remaining 24 Starbucks stores and entered a franchise agreement with the brand.

Does Starbucks still operate in Australia after the 2024 sale?

Starbucks no longer operates any company-owned stores in Australia after selling its last 24 locations to The Withers Group in 2024, though some franchised outlets may remain.

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