Just a few hours ago, the famous Starbucks chain confirmed that it will close hundreds of its coffee shops in the United States and Canada, in addition to laying off approximately 900 non-retail employees. This decision was made as part of a restructuring plan valued at more than $1 billion.
According to Brian Niccol, the company’s CEO, the closures will only affect about 1% of its operations in North America and will focus on underperforming locations or those that fail to meet customer experience standards. Starbucks will also eliminate hundreds of unfilled vacant positions, along with cuts to its corporate workforce.
The affected employees will be notified this week. The company has stated that all of them will be offered relocation to other franchises or severance packages if no positions are available. Starbucks emphasized that although this measure is difficult, it is necessary to strengthen its business and prioritize resources toward its most profitable units.
What kind of impact will these closures and layoffs have on the company’s customers and employees?
The announced closures could reduce the availability of nearby stores for many consumers and loyal customers, leading to significant financial and job losses. For employees, it means job uncertainty, although the company has promised relocation or compensation for everyone affected.