Starbucks to Close 250 North American Stores This Week... 'Does Closing More Mean Earning More?'

Cost Reduction Achieved Through Store and Workforce Cuts

U.S. Sales Rise 7.9% in Recent Quarter

The largest coffee franchise in the United States, Starbucks, has decided to close 250 stores in North America.

Starbucks

According to reports from foreign media outlets such as CNN and the Associated Press on September 24 local time, Mike Grams, Chief Operating Officer (COO) of Starbucks, announced in a statement that the company would close 250 stores by the end of this week due to their inability to provide the desired experience for customers and partners or their poor financial performance. Grams added, "We remain highly optimistic about the long-term growth opportunities in North America," and emphasized that the company is actively pursuing robust plans to open new coffee shops and is fully committed to growth. However, with Starbucks currently operating about 18,000 stores in North America, the closures account for roughly 1% of all locations.

This approach to cutting costs by closing stores and reducing staff has been part of the management policy of CEO Brian Niccol, who joined Starbucks in 2024. The company plans to allocate 300 million dollars (approximately 410 billion won) for closing costs, including lease terminations and severance payments. Additionally, Starbucks is implementing measures such as store remodeling, service improvement, and menu simplification to put its North American business back on a growth trajectory.

Last year, Starbucks closed 627 underperforming stores and laid off 900 corporate employees. This year, the company also closed regional offices in Chicago, Atlanta, Dallas, and Burbank, resulting in 300 head office job cuts. Furthermore, last month, about 200 employees in design, development, and technology roles—including staff who refused to relocate to Nashville, Tennessee—were additionally laid off.

As the management team enforces strict cost controls, earnings are showing signs of improvement. Starbucks' sales have returned to a growth trend compared to one year ago, and U.S. store sales in the most recent quarter increased by 7.9%. CEO Niccol stated in the July earnings report, "This quarter marked the clear emergence of Starbucks' growth momentum."

This content was produced with the assistance of AI translation services.