Buoyant Starbucks gets set to open franchise stores in UK

The coffee giant Starbucks has revealed it will open its first franchise stores in the UK later this year, following one of its best December trading periods.

Starbucks UK also revealed that it will invest £8m in refurbishing an additional 70 London stores ahead of this summer's Olympic Games, including six more high-profile renovations at shops in the capital's West End and City.

Kris Engskov, the managing director of Starbucks UK and Ireland, described the decision as "significant", as it would enable the coffee chain to open up stores in small towns where a franchisee would be able to contribute their local knowledge.

Starbucks said last month it plans to open 300 outlets over the next five years, of which a third will come from its licence agreement with the petrol forecourt retailer Euro Garages.

Mr Engskov said Starbucks UK was talking to potential franchisees and hoped to have the first such store open before the end of this year.

But he stressed that the franchise model would remain a small part of its overall business, with the majority of its stores continuing to be company-owned.

"I think it is strategically significant. This is by far the most competitive espresso market in the world – more than the US – particularly in London.

"So you have to be open to exploring every lever."

Starbucks, which has nearly 750 stores throughout the country, does not provide UK sales figures. But Mr Engskov said that, following 10 quarters of sales growth, the UK and Ireland enjoyed some of its "busiest trading ever in December".