Starbucks Expands in Latin America

Mexico City Starbucks is expanding in Latin America where its sales are increasing, Reuters reported.

Starbucks Corp.'s main Latin American franchiser Alsea said it is sticking to its plans to open 14 new stores in Mexico in 2009, as well as 12 outlets in Argentina, 17 in Brazil and four in Chile.

The expansion south of the border comes as Starbucks struggles in the United States, having announced it would close 300 stores this year — 200 of them in the United States and 100 in international markets.

The shutdowns will add to a previously announced closure of 600 U.S. stores as consumers, hit by a recession, are buying less-expensive coffee drinks.

But in Latin America, where Starbucks does not have company-operated stores, Alsea said business is strong.

"They are very different markets. The brand is very new here so we don't have as many stores as in the United States," an Alsea spokesperson told Reuters.

Over-saturation of the U.S. market has been cited as one reason for the slowing sales and store shutdowns. At the end of the fourth quarter, there were more than 11,500 U.S. Starbucks stores, and more than 5,000 abroad.

Fast-food franchiser Alsea, which also operates Domino's Pizza and Burger King restaurants, opened 80 Starbucks stores in Mexico in 2008 and its first coffee shop in Argentina last May.