Starbucks will close about 250 underperforming stores across North America this week as part of its ongoing restructuring efforts. This marks the second major wave of closures since CEO Brian Niccol took over in 2024, according to Los Angeles Times, PBS, and UPI. The company announced the closures in a letter to employees from Chief Operating Officer Mike Grams.
Key Takeaways
Starbucks will close 250 underperforming stores across North America this week as part of its ongoing restructuring efforts. This marks the second major wave of closures since CEO Brian Niccol took over in 2024.
- Starbucks plans to shutter about 1% of its total locations, approximately 250 stores, in North America.
- The closures are part of CEO Brian Niccol's 'Back to Starbucks' improvement initiative.
- Employees will be offered transfers or severance support, with the restructuring expected to cost around $300 million.
- Over 700 U.S. Starbucks stores have voted to unionize since late 2021, but no labor agreement has been reached.
- The company aims to retrofit 1,500 stores by the end of its fiscal year.
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▼Source Claims Check
High ConsensusAll 3 publishers report consistent facts across 3 key claims.
| Claim | Status | Reason | |
|---|---|---|---|
| Number Of Stores To Close | Broad Agreement | 250 stores in North America | |
| Total Number Of Stores | Broad Agreement | 18,000 locations worldwide | |
| Cost Of Restructuring | Broad Agreement | $300 million including severance and lease-breaking costs |
Number Of Stores To Close
Broad Agreement250 stores in North America
Total Number Of Stores
Broad Agreement18,000 locations worldwide
Cost Of Restructuring
Broad Agreement$300 million including severance and lease-breaking costs
This analysis is AI-generated and may not perfectly represent each source's reporting. Always read the original articles for full context.
The closures are part of Niccol's 'Back to Starbucks' improvement initiative, as reported by UPI. In September 2023, Starbucks closed 627 stores in North America and Europe and laid off 900 non-retail employees. The targeted locations either aren't delivering acceptable financial results or can't provide the kind of experience that Starbucks wants for customers and employees.
The company did not specify which coffeehouses will close or how many are located in the U.S., per Los Angeles Times and PBS. It also didn't say how many of the affected coffeehouses are unionized, though more than 700 U.S. Starbucks stores have voted to unionize since late 2021. However, Starbucks does not support the unionization effort, and no labor agreement has been reached.
Grams mentioned in his letter that Starbucks is continuing to retrofit its North American coffeehouses to make them cozier and more inviting. The company expects 1,500 stores will be retrofitted by Sept. 30, which is the end of Starbucks' fiscal year.
The restructuring is expected to cost about $300 million, including $200 million for breaking leases and paying severance benefits to employees. The remaining $100 million will come from the disposal of restaurant assets owned by the company, as reported by UPI. Starbucks shares rose less than 1% Thursday in premarket trading.
In May, Starbucks laid off an additional 300 corporate employees and closed some underused U.S. offices. The company said it will transfer employees to other stores if possible or provide severance support if it's not able to place an employee in another location.
How this summary was created
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