‘These decisions impact our partners and their families, and we did not make them lightly’: Starbucks’ CEO pledges severance, support and future opportunities for affected employees
Starbucks is set to close a number of its coffeehouses across North America, including Canada, and eliminate approximately 900 non-retail jobs as part of a sweeping restructuring effort aimed at strengthening its core business and enhancing the customer experience.
The announcement, made by chairman and chief executive officer Brian Niccol in a post on Starbucks’ company blog, comes as the company reviews its North American portfolio under its “Back to Starbucks” plan, he said.
“Our goal is for every coffeehouse to deliver a warm and welcoming space with a great atmosphere and a seat for every occasion,” Niccol said in the post.
“During the review, we identified coffeehouses where we’re unable to create the physical environment our customers and partners expect, or where we don’t see a path to financial performance, and these locations will be closed.”
Starbucks has also been in headlines recently for union grievances over uniform requirements.
Store closures ‘will impact partners and customers’
While Starbucks regularly opens and closes stores for reasons ranging from lease expirations to financial performance, Niccol acknowledged the scale of this move.
“This is a more significant action that we understand will impact partners and customers. Our coffeehouses are centers of the community, and closing any location is difficult,” he said.
The company expects its total number of company-operated stores in North America to decline by about one per cent in fiscal 2025, ending the year with nearly 18,300 locations across the U.S. and Canada.
Starbucks also plans to upgrade more than 1,000 locations over the next year to “introduce greater texture, warmth, and layered design.”
“As we build toward a better Starbucks, we’re investing in green apron partner hours, more partners in stores, exceptional customer service, elevated coffeehouse designs, and innovation to create the future,” Niccol said.
Affected employees – referred to as “partners” – in closing stores will be notified this week.
Starbucks says it is “working hard to offer transfers to nearby locations where possible and will move quickly to help partners understand what opportunities might be available to them.”
For those who cannot be immediately placed, the company is “focused on partner care including comprehensive severance packages” and hopes to rehire as new stores open.
900 non-store Starbucks roles to be cut
In addition to store closures, Starbucks will cut about 900 non-retail roles and close many open positions, the post detailed.
Those affected will be notified and offered “generous severance and support packages including benefits extensions.”
Niccol emphasized the company’s commitment to its workforce and future growth: “I believe these steps are necessary to build a better, stronger, and more resilient Starbucks that deepens its impact on the world and creates more opportunities for our partners, suppliers, and the communities we serve.”
Starbucks says it will continue to invest in its stores, staff hours, and customer experience as it navigates this transition.
