Starbucks Announces Store Closures Amid Concerns Over Employee Layoffs
Starbucks has announced it will close 250 stores across North America by the week’s end. This decision has prompted concern for employees who face uncertainty about their future, having been notified with little warning.
One Starbucks customer shared on Reddit a picture of a letter on their local store’s door, which thanked ‘amazing customers’ while announcing the closure. The user expressed empathy for employees, noting the difficulty in finding new jobs during tough economic times.
Another Reddit user recounted speaking with a barista given less than 48 hours notice. The barista mentioned they were uncertain about being laid off, expecting to find out on Monday.
Posts on the Reddit thread r/starbucksbaristas revealed frustrations over short notice lay-offs, contrasting the requirement for employees to provide two weeks notice if they choose to leave. Some workers were laid off with only one to three days notice.
A former store manager described the closure experience as ‘bittersweet,’ expressing hope for a transfer, and showed some resignation in the phrase ‘until next time.’
Starbucks’ Chief Operating Officer Mike Grams explained in a memo that the closures followed a review of store performance. The review found many locations could not maintain consistent financial productivity or customer service. Approximately 1% of Starbucks’ 18,000 North American stores will close.
The decision was difficult but necessary, Grams acknowledged, ensuring customers, employees, and communities rely on Starbucks’ support during this transition.
Grams stated that affected employees may transfer to other stores. Those unable to do so will receive severance pay.
The closures form part of a $1 billion restructuring initiative previously announced by CEO Brian Niccol, aimed at maintaining Starbucks’ presence in North America without withdrawing entirely.
Each year, Starbucks closes some cafes while opening others to manage its portfolio, Grams noted, emphasizing ongoing development of new stores and commitment to growth. Despite growth, Starbucks plans fewer global openings this fiscal year: 440 compared to the previously announced 600-650.
The closure process involves significant costs, with a reported $300 million in related charges, including $200 million for lease terminations and severance benefits.
A detailed list of affected stores in various regions, including California and other parts of the U.S., highlights closures. Some locations were reported by local news sources as closed, though Starbucks did not confirm all closures. An open-access list created by affected employees lists more locations across numerous states.
Newsweek reached out to Starbucks and involved Reddit users for comment, but verification of all listed closures remains pending.