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Starbucks Announces Plans to Close All Teavana Stores by Spring 2018

Starbucks Announces Plans to Close All Teavana Stores by Spring 2018

By Ambia Staley

Teavana, a go-to favourite for many tea aficionados, will be leaving the retail market, as their parent company Starbucks announced plans to close all retail locations due to low profitability.

This closure will see all 379 Teavana locations worldwide, including 56 locations in Canada, close their doors. Most locations are expected to close by spring 2018, but the first closures could be seen in Canada as early as September of this year.

Starbucks acquired Teavana at the end of 2012 for US $620 million. At the time, former Starbucks CEO Howard Shultz believed "the tea category is ripe for reinvention and rapid growth," and, "the Teavana acquisition now positions us to disrupt and lead, just as we did with espresso starting three decades ago."

Unfortunately, the former CEO's hopes for the brand's rapid growth did not come to fruition as the brand was persistently under-performing, and efforts to reverse it through creative merchandising and new store designs have done little to turn the tide. Current CEO Kevin Johnson has also noted the decrease of foot traffic in malls as one of the reasons for Teavana's struggles. Johnson does not however, see promotions such as McDonald's $1 Drink Days as a reason for the cut in Teavana and Starbucks sales, as "value players" such as McDonald's compete in a different part of the market.

The Teavana closures will affect approximately 3,300 jobs worldwide, however Starbucks has said that employees impacted by the Teavana closures will be given opportunities to apply for positions at Starbucks.

There is currently no official word regarding clearance sales or whether or not Teavana will still exist on Starbucks' menu after the closures, although many expect it to remain, citing La Boulange as an example -- Starbucks acquired the bakery chain back 2012 and incorporated some of its baked goods into their menu before finally closing all La Boulange stores in 2015.

Are you a fan of Teavana tea? Are you disappointed to hear about the store closures? Let us know in the comments!

18 Comments

    • I'm definitely disappointed to read this news. I hope that the website remains in tact as there are a few teas from Teavana that my wife and I really enjoy and always keep in stock at home.
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    • Its too expensive thats why
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    • David's tea must be very happy to hear this news...ah, but how are they doing?
      Could they be next? Looks like they're also having some trouble...hopefully just in the States... http://www.ctvnews.ca/business/davidste ... -1.3449917

      "Since reaching a stock price of US$27 following its public offering two years ago, DavidsTea's shares have plunged to $5.97 in Thursday trading." OUCH!!!!
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    • ChicoQuente wrote:
      Jul 28th, 2017 1:37 am
      I'm definitely disappointed to read this news. I hope that the website remains in tact as there are a few teas from Teavana that my wife and I really enjoy and always keep in stock at home.
      You can get almost all of Teavana's products at Starbucks:
      http://store.starbucks.ca/tea/tea,en_CA ... Tea%20Bags

      Starbucks did the same thing with La Boulange -- bought that company, incorporated its products into its regular stores (the newer baked goods)... then shut down that chain a few years later.
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    • Will miss their samples.
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    • There are Teavana stores?
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    • I better redeem my SB Rewards soon. The only reason why I try to frequent SB often is that I can get loose-leaf tea as a reward at Teavana. This might reduce my SB frequency. The store here is always packed. Probably others aren't doing so well.
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    • The biggest thing about tea is, that a little bit goes a LONG way. I have bought tons of tea from all different places over the years, and I still have way too much to drink than I could drink.
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    • I have worked at Teavana, as a part-time sales associate, for the past four years. I'm honestly not surprised in the least. When Starbucks acquired Teavana, there was hope that things would change for the better, but it seems that was wishful thinking. Oh, and FYI guys, expect a 75% off everything sale very, very shortly. Hehe.
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    • The Teavana locations in my area really went downhill after the Starbucks acquisition. I've got a bit of social anxiety, and every time I went to Teavana after that point the staff would try their hardest to push me into a sale. Never had that issue with Teaopia or the old Teavana. That's genuinely the reason why I avoid the place like a plague now, tea buying and drinking should be a calm experience and I'm more than willing to blow $100 on my own terms at a local loose-leaf store or David's Tea.
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    • CEO Howard Schultz noting the huge potential for the tea market
      it's like Starbucks but for tea! How could it go wrong.

      Note to self: divest myself of all HotChocolarama stock.
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    • Are teavana gift cards valid at Starbucks, or should I be rushing to cash that in?

      Nvm, I see they've updated website since I last checked. Yes, valid at Starbucks.
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    • Another one bites the dust in Canadian retail.
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    • Could this be a case of "Teavana stores don't have a 500000% profit margin like regular Starbucks stores so we're closing them"?
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    • warpdrive wrote:
      Jul 29th, 2017 2:33 am
      Could this be a case of "Teavana stores don't have a 500000% profit margin like regular Starbucks stores so we're closing them"?
      Have you ever shopped at Teavana to see the ludicrous prices they have? It's not cheap because it's tea, if that's what you're thinking.

      IMO, more the problem with these "boutique" teas is that it's a real niche market. Most people that come from cultures/countries/backgrounds where tea is popular and commonly drunk, do indeed drink a crap ton of tea. Growing up all I ever drank was tea because that's what my parents drank at a rate of several cups a day, everyday. Coffee was a thing we only had/made at like get togethers/parties or whatever. And then, as a kid, the only way I knew how to drink coffee was to cram it full of sugar LOL. I only really started drinking coffee as an adult and yeahhh sugar totally ruins it so I never add it to coffee, that's for sure. Even today I basically only drink coffee outside the house but at home 90% of the time it's tea. But anyway, my point is, though some people do drink tons of tea, the kind of tea is basically just orange pekoe or some other black tea where you buy like 144 bags in a box from the grocery store. None of these tea drinkers go to places like Teavana to stock up on these weird and eccentric teas they have there, lol.

      So basically you're just left with hipsters and people that think tea is healthy and "better for you" than coffee but never really had a high level of tea consumption from childhood. It's not a huge market and nowhere near the market for coffee. It's just a niche-market boutique and when regular retail stores can't stay afloat in Canada as it is, boutiques aren't going to be around long either, esp. when they're all in places like malls which have high overhead and operating costs.
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    • Think part of their problem is they used to be the only game (Teaopia days) in most malls I have been too. Now, David's tea is sort of seen as the Starbucks of tea, so they are no longer leading the market.
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    • Starbucks stores sell Teavana tea as well, overpriced teas...
      Prefer David's Tea than Teavana btw
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    • I used to work for Starbucks and loved the Teavana brand! I am disappointed that hey are closing, yes!
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