(qlmbusinessnews.com . Fri 26th Sep, 2025) London, UK —
Starbucks to Slash 900 Jobs and Shut Down Underperforming Outlets in Strategic Overhaul
Starbucks has announced a significant reduction in its workforce, with approximately 900 jobs set to be cut in the United States and plans to close its underperforming outlets there, in addition to shutting down selected stores within the UK. This strategic decision aims to streamline operations and facilitate cost efficiencies.
The restructuring will primarily affect North American locations, but the coffee giant's chief executive has assured that the changes will enhance service speed and stimulate sales rejuvenation. The company had previously disclosed a reduction of 1,100 positions and a simplification of its US menu earlier in February, in an effort to reinvigorate domestic sales.
Brian Niccol, Chief Executive of Starbucks, acknowledged the weight of the decision, recognising its impact on both employees and patrons. However, he reassured stakeholders that Starbucks remains committed to its expansion plans in the UK, with an aim to inaugurate 80 new stores. “Even as we make tough choices about certain stores in the UK, Switzerland, and Austria, our target to unveil 80 new outlets in the UK and a total of 150 across the EMEA region within this financial year remains intact,” the company stated.
In a communication to staff, Mr Niccol pointed out that the earmarked outlets for closure failed to meet the brand's standards in customer experience or financial viability.
The forthcoming job eliminations in the US will predominantly affect corporate and support roles. This news follows a disconcerting trend for Starbucks, with the brand witnessing a sixth consecutive quarter of declining year-over-year sales in its crucial US market, leading to an over 8% decrease in its stock value this year.
Since taking the helm of Starbucks last year after a successful tenure at Chipotle Mexican Grill, Niccol has embarked on an ambitious turnaround plan. This strategy includes renovating stores, enhancing seating arrangements, and reintroducing self-service condiment bars, aiming to win back disillusioned customers. Despite these vigorous efforts, analysts from TD Cowen highlight Starbucks' ongoing battles with rising competition from drive-through coffee shops and a diminishing brand perception compared to its competitors.
Additionally, the brand faces discontent among its workforce, with a unionisation drive among US baristas gaining momentum. Workers United, representing employees across more than 600 Starbucks' owned US stores, criticises the company for making significant operational changes without consulting baristas. The union is pushing for a contractual agreement, voicing concerns over staffing levels and barista welfare.
In light of the restructuring announcement, Workers United expressed dismay at the direction Starbucks is taking under Niccol's leadership, lamenting the lack of employee consultation in the decision-making processes. The union has formally requested detailed information from Starbucks regarding the planned store closures, signaling ongoing tensions between the workforce and management.
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