Starbucks is considered one of the largest coffeehouse chains in the world. However, in recent months the company has been forced to take serious measures due to financial difficulties and increased competition in the market. According to Starbucks management, by the end of the month it will close nearly 400 stores only in North America. As a result, around 900 employees are expected to lose their jobs. This was reported by Bloomberg.
The company states that this measure is being taken to reduce costs and allocate existing resources more effectively. Starbucks executives hope that this will prevent customers from having to wait in long lines and increase sales volume at the most profitable locations.
In February, Starbucks also made a drastic decision. At that time, following a decline in sales, the company announced plans to cut 1100 jobs in the US and simplify the menu. Thus, within just one year, the chain was forced to give up a total of 2,000 jobs in its home country.
According to the company's CEO Brian Niccol, the new cuts will be implemented not only in America but also in Europe. Specifically, some coffeehouses in the UK, Switzerland, and Austria will cease operations. However, in this context, the company has not abandoned its plans to open new outlets in the next financial year. For example, 80 new stores are expected to open in the UK alone, and another 150 across Europe, the Middle East, and Africa.
Nevertheless, the negative indicators in financial reports have also affected the company's stocks. Since the beginning of the year, Starbucks securities have fallen by 8 percent.
Independent analysts attribute this situation to several factors. For example, specialists at TD Cowen emphasize that the increasingly popular "drive-thru" stores in the US—allowing customers to purchase coffee without leaving their cars—have become serious competitors for Starbucks.
According to poll results, more than 70 percent of customers reported reducing their visits to Starbucks coffeehouses due to high prices. Thus, the chain faces significant challenges not only in internal planning but also in pricing policy and maintaining customer trust.
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