Starbucks, the renowned coffee powerhouse, has announced an extensive restructuring plan. As part of this $1 billion strategy, CEO Brian Niccol, in a memo to employees, disclosed plans to lay off workers and downsize stores.
Reports indicate that around 900 employees at Starbucks’ North American outlets will face layoffs. Additionally, the store closures, Niccol mentions, will result in a near 1% reduction in the total Starbucks locations across North America for this fiscal year. This is after considering the addition of new store openings.
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Despite these drastic measures, the CEO maintains an optimistic tone. “While we’re making good progress, there is much more to do to build a better, stronger, and more resilient Starbucks,” Niccol said.
This development follows earlier reports that Starbucks has been grappling with sluggish sales in recent years. According to reliable sources, customers have been facing a prolonged bout of elevated inflation, which analysts believe could have impacted the company’s performance.
In the face of these changes, the company’s shares showed a slight increase in pre-market trading after the early Thursday morning announcement.
A major player in the global coffee industry takes steps to restructure, causing job cuts and store closures, all while dealing with the challenges of a stagnant market and elevated inflation.
