Starbucks Shakes Things Up: Major Store Closures and Job Cuts Unveiled

Starbucks is taking drastic measures to revitalize its struggling business in the US and UK, announcing plans to cut around 900 jobs and close some of its worst-performing stores. This move follows previous layoffs of 1,100 employees as part of a broader strategy to address flagging sales in its home market.

Chief Executive Brian Niccol stated that the closures, primarily affecting North America, aim to reduce wait times and improve customer satisfaction. While the company is committed to opening 80 new stores in the UK, it will also shutter a number of locations in the UK, Switzerland, and Austria due to a recent portfolio review.

Niccol emphasized that the stores targeted for closure failed to meet the physical and financial expectations of the brand. Starbucks’ ongoing challenges are illustrated by its sixth consecutive quarterly drop in sales at established locations in the US, raising concerns about competition from drive-through alternatives and a shift in consumer perception compared to rival brands.

As part of Niccol’s turnaround plan, which aims to lure back dissatisfied customers, Starbucks is also remodeling stores and reintroducing self-service condiment bars. However, the company’s restructuring comes amid tensions with a unionization campaign among its baristas, represented by Workers United, which has criticized Starbucks for not involving employees in significant policy changes. The union claims these business decisions are a sign of regression under Niccol’s leadership, pointing to issues of under-staffing and overwhelmed employees. The company is currently facing increasing pressures both from its operational challenges and from a push for better working conditions.