Karstadtquelle to focus on core retail offer
Starbucks venture to go in shake up at German retailer
German retail group Karstadtquelle is to refocus on its core business as it implements strategy to restore profits.
The company, whose interests include the Karstadt department store chain, mail order, and a stake in the Thomas Cook travel business, said it is refocusing the group on its strengths and core competences.
This will include an end to a disappointing joint venture with Starbucks and a focus on retail rather than services in its store operations. It will focus on its largest 89 department stores, and is looking for buyers for smaller stores, as well as speciality retail chains SinnLeffers, Wehmeyer, Runners Point, Golf House, a chain of fitness stores and the Starbucks outlets.
In mail order, the focus will be on growth areas of the Quelle and Neckermann brands, including e-commerce. The group will also aim to increase mail order sales outside Germany.
The revamp of the business will generate costs of €1.4bn in 2004, with Karstadtquelle’s supervisory board saying it expects to move back into profit during 2005. The group has previously announced 4,500 job cuts, but has not yet said whether this figure will increase.
