Starbucks opened six stores in Israel — all closed within two years

Starbucks entered Israel in 2001 through a joint venture with the Delek Group, forming Shalom Coffee Company. The first location was planned to open on September 1, 2001 in Tel Aviv's Rabin Square. The company ultimately opened six locations, all in Tel Aviv, and employed 120 people. A planned Jerusalem location was withdrawn due to security concerns.

Within a year of opening, Delek Group sought to sell its stake in the joint venture, signaling that the business was underperforming. The stores struggled to gain traction in a market with established local coffee culture and strong competitors like Aroma Espresso Bar and Arcaffe.

On March 31, 2003, Starbucks announced the closure of all its Israeli stores. The company cited business reasons for the exit, not political factors. The entire Israeli operation was shut down after less than two years of operation.

Starbucks did not return to Israel for over two decades. In 2025, the company announced plans to re-enter the market through a new partnership with the Fox Group, with the first new store expected to open in 2026.