Starbucks is set to lay off approximately 900 non-retail workers and shut down several stores in the United States and Canada as part of its restructuring efforts. The Seattle-based coffee chain will inform the affected employees of their job cuts early on Friday, along with plans to close an undisclosed number of locations in North America in the near future.
A spokesperson for Starbucks Canada confirmed the developments but did not disclose the exact number of Canadian employees impacted by the layoffs or specify which Canadian stores would be closing. According to a letter from Starbucks CEO Brian Niccol on Thursday, a review of the company’s store network revealed that many outlets were not meeting financial targets or failing to deliver the desired customer experience.
Niccol emphasized that the decision to close certain coffeehouses was a significant move that would have repercussions for both employees and customers, as Starbucks outlets serve as vital community hubs. The company stated that it anticipates ending the fiscal year with 18,300 stores in North America, a decrease of 124 stores compared to the previous year, marking an unusual contraction in Starbucks’ store count for a fiscal period.
Niccol, known for his expertise in leading turnarounds, was appointed to revitalize the Starbucks brand a year ago. During his tenure as CEO of Chipotle for approximately six years, he successfully doubled the chain’s revenue and profit, leading to a substantial increase in the company’s stock price. Starbucks has committed to providing severance packages and assistance to the impacted employees during this transition period.
