Starbucks is set to lay off approximately 900 non-retail workers and shut down several stores in the U.S. and Canada as part of its efforts to refocus resources and drive a turnaround. The renowned coffee company based in Seattle will inform employees affected by the job cuts on Friday and intends to close an undisclosed number of stores in North America in the near future.
A spokesperson for Starbucks Canada has confirmed the development but did not disclose the exact number of Canadian employees impacted or specify the locations in Canada that will be closing. According to a communication from Starbucks CEO Brian Niccol on Thursday, an evaluation of Starbucks outlets revealed that many are not meeting financial targets or failing to deliver the expected customer experience.
Niccol stated, “Each year, we open and close coffeehouses for various reasons, ranging from financial performance to lease expirations. While this decision will have a significant impact on our partners and customers, we recognize that our coffeehouses play a vital role in the community, and any closure is a challenging process.”
Starbucks announced its projection to finish the fiscal year with 18,300 stores in North America, a decrease of 124 compared to the previous year. This reduction in store count within a fiscal year is uncommon for Starbucks. Niccol, known for his expertise in turnarounds, was appointed to lead Starbucks a year ago with the aim of revitalizing the brand.
During Niccol’s tenure at Chipotle, the struggling chain saw a remarkable increase in revenue, profitability, and stock value. Starbucks assured that it will provide severance packages and assistance to the impacted employees.
