Store Ambiance Key to Starbucks' Plans

By ELIZABETH M. GILLESPIE AP Business Writer
© 2008 The Associated Press

SEATTLE — It's been almost a year since Chairman Howard Schultz' bitterly candid memo bemoaning "the watering down of the Starbucks experience" landed with a thud on the desks of the coffee chain's top executives.

Mincing no words, he complained the company's unbridled growth had sapped the soul out of its stores _ his rallying cry to shift the focus back onto the customer.

He sounded just as frustrated earlier this month after the company fired Chief Executive Officer Jim Donald, handing the reins back to Schultz as part of a sweeping plan to reinvigorate the company, which has seen its stock slide 50 percent since late 2006.

Without releasing specifics, Schultz said Starbucks will scale back growth in the U.S., close lackluster stores, bolster expansion overseas and focus on changes to revitalize the atmosphere inside its stores.

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