TL;DR: Starbucks is closing about 400 stores in North America this fiscal year as part of a $1 billion plan to improve financial performance and customer experience. The company is also cutting 900 corporate jobs, offering transfers or severance to affected employees, and plans to remodel over 1,000 stores. The move has drawn union criticism amid ongoing sales challenges.
Key Points:
- Starbucks announced it will close roughly 1% of its North American stores, about 400 locations, during fiscal year 2025, targeting stores unable to meet desired physical environment or financial goals.
- The closures are part of a $1 billion restructuring plan led by CEO Brian Niccol, aiming to improve customer service, remodel stores, and reduce wait times.
- Approximately 900 corporate, non-retail jobs will be cut in North America, alongside previous cuts of 1,100 earlier this year.
- Starbucks plans to remodel over 1,000 stores with cozier seating, more power outlets, and warmer designs to enhance customer experience.
- CEO Niccol said in a letter, “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.”
- The Seattle Reserve Roastery and stores in Boston, Washington D.C., and Chicago are among the affected locations, with closures starting late September 2025.
- Starbucks Workers United union criticized the closures, citing understaffing and lack of frontline employee input, stating, “Fixing what’s broken at Starbucks isn’t possible without centring the people who engage with the company’s customers day in and day out.”