Coffee Bean orders Israeli branches closed

Coffee Bean and Tea Leaf LLC has ordered its Israeli franchisee City Food Ltd. to close its branches by next week.

Coffee Bean and Tea Leaf LLC yesterday ordered its Israeli franchisee City Food Ltd. to close its branches by the end of next week, as City Food's worsening financial problems have brought it to the verge of complete collapse. The global café chain has been operating in Israel since 2000.

As first reported by "Globes", City Food's financial circumstances recently compelled it to close some of the 14 Coffee Bean branches in Israel, and the remaining branches now face the axe. City Food's financial situation deteriorated seriously in the past year, and foreclosure claims have been filed it and one of its owners.

According to the law firm representing Coffee Bean in Israel, City Food ceased cooperating with Coffee Bean several months ago. Coffee Bean said, "As of today, the Israeli franchisee is not responding to our inquiries, is not sending us reports, and in effect has not taken any of the measures demanded of it recently by Coffee Bean. For these reasons, Coffee Bean has decided to cancel the franchise agreement."

Coffee Bean looks set to follow in the footsteps of other major global food and cafe franchises like Starbucks and Dunkin Donuts that have left Israel in recent years.

Published by Globes [online], Israel business news - - on August 5, 2010

© Copyright of Globes Publisher Itonut (1983) Ltd. 2010

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