The money-losing Juan Valdez chain of Colombian coffee shops will close its Times Square branch in New York City on February 28, Colombia’s National Federation of Coffee Growers, or Fedecafe, said Friday.
A Fedecafe spokesman said the closure was due to changing consumption patterns because of the ailing economy, causing people to buy more coffee from supermarkets to brew at home and fewer coffee drinks prepared in shops. Its remaining stores in New York City will remain open.
Juan Valdez has also shut stores in Spain in recent months.
The Juan Valdez brand is managed by Procafecol S.A., a holding company majority-owned by Fedecafe.
Procafecol made a loss of COP11.4 billion (US$5.9 million) in the first nine months of 2009, compared to a COP7 billion loss in the first nine months of 2008, according to its filing to the local market regulator. Sales increased to COP56.9 billion over the same period, from COP53.1 billion in the first nine months of 2008. However, sales from Procafecol’s foreign outlets fell to COP7.9 billion, from COP9.5 billion in the first nine months of 2008.
Fedecafe’s press office told Dow Jones that Procafecol’s expansion plans had been heavily focussed on the U.S. and Spain, two economies that were badly hit by the economic crisis and the resulting cut in consumer spending.
Juan Valdez also has coffee shops in Ecuador and Chile. Procafecol also sells a range of products, such as roasted coffee to supermarkets and refills for coffee machines. (Dow Jones)