Over 100 Starbucks outlets in Malaysia closed as boycott of US brands takes bite

[Editor's Note: Starbucks Malaysia has since reportedly denied closing down more than 100 outlets. Read report here.]

More than 100 Starbucks outlets in Malaysia have been forced to shut down their operations either permanently or temporarily, some six months after a similar fate befell KFC, as global American brands continue to be targeted by an international boycott movement to protest US aid to Israel's genocidal war in the occupied territories.

It also comes about two months after Starbucks Malaysia, which is linked to conglomerate Berjaya Group, reported a net loss of RM91.5 million this year, with revenue falling 35% from RM1.1 billion to RM730.3 million.

A source told MalaysiaNow that more than 100 Starbucks outlets across the country, including in major shopping malls and tourist spots, have either closed or are temporarily closed.

"A temporary closure means that the company is only paying rent for the premises but is not operating until sales pick up," the source said.

MalaysiaNow was unable to independently verify the figure, but a quick check on the Starbucks website showed that at least 60 branches are marked either closed or temporarily closed.

In Kuala Lumpur, the affected outlets are located at the Kuala Lumpur City Centre, Masjid Jamek, The Weld, UOA Damansara, KPJ Tawakkal Hospital Jalan Pahang, KPJ Ampang, Plaza Shah Alam, MSU University, Sunway Lagoon, G Village, Ampang Jaya, Setiawalk, Menara Axis, Menara Olympia, Cheras Leisure Mall, Mid Valley 2, Alpha Angle, Akasa Business Park, Giant Kelana Jaya, UOA Pantai, LRT Bandar Tasik Selatan, Thompson Hospital Kota Damansara, IPC Shopping Center, Aeon Bukit Raja and The Curve.

In Selangor, the branches affected are at Bangi Gateway, KLIA 2 Gateway, KLIA 2 Satellite, Selgate, Arena Exchange, Subang Parade, The Mines, D Pulze Cyberjaya, Setia City Mall, Lotus Jenjarom, Quayside Mall, Alamanda Putrajaya, Suasana PJH, Gamuda Cove and Semenyih.

In Pahang, Starbucks outlets in Kuantan 188, Kota SAS, Genting Skyworld and Cameron Highlands have been closed, while Troika Kota Bharu, one of three outlets in Kelantan, is also closed.

Other closed branches are located in Johor, Negeri Sembilan, Melaka, Perak, Kedah and Penang.

In Sarawak and Sabah, at least three starbucks outlets are no longer in operation.

It is understood that more Starbucks outlets in Aeon AU2, Datum Jelatek and Ukay Perdana are expected to close in November.

Local competitors

Starbucks and KFC, along with other major Western fast food companies such as McDonald's and consumer brands such as Nestle, are among the most affected by the global boycott, despite creative attempts by their owners in Muslim countries to distance themselves from Washington's policy in the Middle East, where more than 50,000 civilians in Gaza and Lebanon have died as a result of Israel's massive bombardment since October last year.

In Malaysia, Starbucks is owned by Berjaya Food, which is part of Berjaya Corporation, the conglomerate linked to prominent billionaire Vincent Tan.

The company also owns the 7-Eleven retail chain, whose chairman is Farhash Wafa Salvador, the former political secretary to Prime Minister Anwar Ibrahim.

In March, Tan called on Malaysians to end the boycott, repeating the familiar excuse of local ownership and employment of locals, none of which have been able to stem the anti-Israel boycott movement.

The following month, DAP leader and federal minister Nga Kor Ming accused those behind the boycott as "instigators" out to ruin domestic economy.

"Never fall into the trap of instigators, our country needs the efforts of all parties to develop the economy," said Nga, who only last year officiated the opening of a new Starbucks outlet in his ministry in Putrajaya.

Starbucks, which has more than 400 outlets and 5,000 employees nationwide, has also had to deal with stiff competition from alternative local and regional coffee franchises that have sprung up in the past year, further hurting the coffee giant's profits.

These include ZUS Coffee, which has overtaken Starbucks as the most popular coffee brand in Malaysia, according to a report by Allegra World Coffee Portal, which analyses the global coffee market for industry leaders.

MalaysiaNow has reached out to Berjaya Food for a response.