"The plan includes closing at least 100 North American cafes and remodeling over 1,000 locations. Starbucks expects its company-operated store count in North America to decline by about 1%, according to a letter from CEO Brian Niccol to employees on Sept. 25. The company had 18,734 stores as of June 29. Starbucks will eliminate about 900 non-retail partner roles and many open positions."
"Affected employees will be notified on Sept. 26 and offered severance and support packages, including extended benefits. The company's goal is to put resources "closest to the customer so we can create great coffeehouses, offer world-class customer service, and grow the business," Niccol wrote. Starbucks is pivoting from mobile-only "pickup" stores, which it thought would appeal to customers, especially younger generations. There's now an effort to recreate a "third place"-a location between home and work to spend time, which once fueled Starbucks' popularity."
Starbucks approved a $1 billion restructuring plan to close underperforming coffeehouses and reshape its corporate support organization under the "Back to Starbucks" strategy. About 90% of the expenses will come from North America, with most costs hitting in fiscal 2025. The plan calls for closing at least 100 North American cafes, remodeling over 1,000 locations, and reducing company-operated store count by about 1%. The company will eliminate roughly 900 non-retail partner roles and offer severance and support. The strategy shifts resources toward in-store experience, moving away from mobile-only pickup formats to recreate a "third place." Same-store sales have fallen for six consecutive quarters and Gen Z market share has declined.
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