Staff /wire report
Caribou Coffee will close 80 underperforming stores and rebrand an additional 88 Caribou outlets to Peet’s Coffee & Tea, just five months after the Minnesota-based company was purchased by a German company for $340 million.
In a statement Monday, Caribou didn’t name which stores it would be closing Sunday. Caribou will remain a chain of 468 outlets in Minnesota, the Dakotas, western Wisconsin, Iowa, Kansas, North Carolina and Denver.
Caribou coffee houses in Ohio, Michigan, Pennsylvania, Maryland, Georgia, eastern Wisconsin and Washington, D.C., will be converted to Peet’s.
A Cincinnati TV station owned by Scripps Media reported that Caribou employees were told Friday night that all Ohio Caribou stores would be closing. The Charlotte Observer reported several Caribou stores there were expected to close this week.
But an employee at the Caribou Coffee location in the Shops at Boardman Park, who was not authorized to speak with the media about the matter, said staffers there were told the location would not close immediately. The Boardman Caribou is expected eventually to be rebranded as a Peet’s Coffee and Tea, the employee said.
A call to the company’s corporate office regarding the Boardman location was not returned Tuesday.
A rebranding at that location is not entirely inconceivable given its location on U.S. Route 224, where retail businesses have done particularly well and increasing traffic is bringing more franchises to the area.
“Over the past few months, we at Caribou have revisited our business strategy, including closely evaluating our performance by market to make decisions that best position us for long-term growth,” Caribou CEO Michael Tattersfield said in a statement.
German conglomerate Joh. A. Benckiser Group bought Caribou in December, taking the once-publicly traded company private. Benckiser earlier in 2012 also bought California-based Peet’s for almost $1 billion.
At the time it bought Caribou, Benckiser gave no indication that it planned to change strategies. In fact, Benckiser’s chairman, Bart Becht, said at the time that “Caribou has a fantastic brand and unique culture and fits perfectly with [the company’s] investment philosophy of investing in premium and unique brands in attractive growth categories like coffee.”
The changes come only months after Joh. A. Benckiser Group bought Caribou for $340 million.
Forbes magazine speculated in December that a merger of the Caribou and Peet’s brands might be likely, noting that Caribou’s locations mostly were in the Midwest and East and Peet’s were in the West.
“To German bean- counters, it may simply not make sense in the long run to maintain two headquarters staffs and facilities for such similar businesses,” Forbes wrote.
One Caribou store in Minnesota’s Twin Cities is closing, and the rest will continue to operate as before under the Caribou name, store employees told a reporter Monday.
Copyright 2013 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.