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Mall Gone: Teavana Tea Stores Are Going Out Of Business

By spring 2018, Teavana tea stores will have mostly vanished from America's shopping centers.

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Starbucks announced Thursday that it will close all of its 379 Teavana stores, and most will be gone by spring 2018, making the tea shop the latest victim of the collapse of mall-based retailing.

There were clear signs of trouble. In April, Starbucks Chief Financial Officer Scott Maw told investors, "Over the last several years, many mall-based retailers have been adversely impacted by reduced foot traffic...[O]ur Teavana mall stores have not been immune, with many reporting negative comps and operating losses for some time."

Starbucks acquired Teavana in 2012, and has had a difficult time trying to make the business work. It opened just a few Teavana "tea bars" that sold prepared teas (rather than packaged tea leaves) that it hoped would spread tea culture but abandoned that business last year to focus on the original stores.

Maw said in April, "We've invested in new store designs and improved merchandising, but the rate of the decline coming through last holiday and into Q2 is worse than we had forecast and we are expecting further declines at a number of at-risk Teavana mall stores."

Sales of Teavana tea products in Starbucks cafés, however, were strong and the company planned to "expand the Teavana tea platform through product innovation and new product offerings all around the world," Maw said this spring.

Starbucks said in a release Thursday:

Many of the company’s principally mall-based Teavana retail stores have been persistently underperforming. Following a strategic review of the Teavana store business, the company concluded that despite efforts to reverse the trend through creative merchandising and new store designs, the underperformance was likely to continue. As a result, Starbucks will close all 379 Teavana stores over the coming year, with the majority closing by Spring 2018. The approximately 3,300 partners impacted by these closures will receive opportunities to apply for positions at Starbucks stores, as Starbucks remains on track to create 240,000 new jobs globally and 68,000 in the U.S. over the next five years.

Teavana still has more than 468,000 followers on Facebook, 128,000 followers on Instagram, and 77,700 on Twitter. But apparently, not enough in the mall.

Starbucks so far has been unable to recreate the success of its cafés in other businesses. In addition to Teavana tea bars, it also closed an Evolution Fresh retail location in San Francisco and its standalone La Boulange bakeries.

Starbucks Is Closing Its La Boulange Stores — Can Its Other Brands Survive?

Starbucks Gives Up On The Teavana "Tea Bar" Business

Venessa Wong is a business reporter for BuzzFeed News and is based in New York. Wong covers the food industry.

Contact Venessa Wong at venessa.wong@buzzfeed.com.

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