Seattle, WA – Starbucks announced a significant restructuring plan that includes closing approximately 1% of its locations in the United States and North America and cutting around 900 jobs. The move is part of CEO Brian Niccol‘s Back to Starbucks transformation strategy to enhance customer experience and improve financial performance.
The Seattle-based coffee giant will reduce its total store count from about 18,734 to nearly 18,300 by the end of its fiscal year in September 2025. This includes roughly 430 fewer locations in the U.S. and Canada, targeting spots where the company cannot meet customer expectations or sustain financial viability.
Location Closures Target Low-Performing Stores
According to the memo shared with employees, Starbucks will close stores that fail to provide the physical environment its customers and employees desire. CEO Brian Niccol explained,
“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, we will close these locations.”
The company has not released a list of affected stores but stated that employees impacted will be notified promptly and offered transfers to nearby locations. Additionally, 900 positions, mostly in non-retail partner roles, will be eliminated as part of the broader plan to streamline operations.
Strategic Focus on Customer Experience and Growth
This restructuring aligns with the Back to Starbucks strategy implemented by Niccol, who assumed leadership in September 2024 after his tenure at Chipotle. The strategy emphasizes:
- Increasing “green apron” partner hours to boost in-store staffing.
- Enhancing the coffeehouse environment with more seating, power outlets, and free coffee refills.
- Upgrading over 1,000 locations with textured, warm, and layered designs to create a welcoming atmosphere.
- Investing in innovation and exceptional customer service to lead long-term growth.
Niccol noted the positive effects of these investments stating,
“Early results from coffeehouse uplifts show customers visiting more often, staying longer, and sharing positive feedback.”
Recent Closures and Employee Impact
Besides the location closures, Starbucks recently announced plans to shut down 80 to 90 “Pick Up” stores across over 20 states—these were stores designed exclusively for mobile orders and quick pickups.
Employees impacted by job cuts will receive generous severance packages and extended benefits. Niccol urged remote work for staff not required to be on-site during the announcement period, signaling a flexible approach amidst the transitions.
Union and Market Reactions
The Starbucks Workers United union, representing 12,000 baristas across 45 states and Washington D.C., responded by emphasizing the need for transparency and fair negotiations.
“We expect to engage in effects bargaining for every impacted union store so workers can be placed in another Starbucks store according to their preferences,” the union stated.
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Starbucks shares experienced slight declines in midday trading following the announcement and have fallen about 7% so far in the year, despite a recent quarterly revenue increase of 3.8% to $9.5 billion.
Looking Ahead: What This Means for Starbucks
The company plans to continue growing its number of coffeehouses in fiscal year 2026 while managing costs carefully. The focus remains on delivering a better customer experience, supported by a more engaged workforce and upgraded store environments.
For more detailed information on the announcement, visit the original report at USA TODAY.
Key Facts At a Glance:
- Approximately 430 Starbucks locations closing in the U.S. and Canada by September 2025.
- About 900 job cuts, mostly non-retail positions.
- Back to Starbucks strategy focuses on customer experience and store upgrades.
- 80-90 “Pick Up” stores to be closed in over 20 states.
- Starbucks stock down ~7% year-to-date despite recent revenue growth.
What do you think about Starbucks’ latest strategy and store closures? Have you noticed changes at your local Starbucks? Share your thoughts in the comments below!