Starbucks Closing Hundreds of North American Stores By the End of the Fiscal Year, CEO Says

Starbucks Announces Plans to Close Hundreds of North American Stores by End of Fiscal Year

In a recent announcement, Starbucks, the popular coffee chain found in numerous locations across North America, has revealed its intention to shut down several stores as part of a significant restructuring effort. The decision to close multiple locations was shared by Starbucks CEO and Chairman, Brian Niccol, who disclosed that these closures are a part of the company’s strategic plan to enhance the overall in-store experience for its customers. The move comes as Starbucks launches its “Back to Starbucks” initiative aimed at improving service quality.

Niccol mentioned that amidst the opening of several new Starbucks outlets in the past year, the total count of stores in North America is set to decrease by approximately 1% during fiscal year 2025 when factoring in both closures and new store openings. According to reports from Nation’s Restaurant News, the reduction in the number of stores within a quarter stands at 2.3%, with a net decrease of about 1.2% when considering the openings in the last two quarters. The CEO explained, “Each year, we open and close coffeehouses for a variety of reasons, from financial performance to lease expirations. This is a more significant action that we understand will impact partners and customers.”

As part of a review conducted on its North American locations, Starbucks identified certain coffeehouses where it was challenging to maintain the desired physical environment for both customers and partners, as well as locations that were not meeting financial expectations. These identified locations are slated for closure in the near future. Additionally, Investopedia reported that approximately 450 stores have already been closed as part of the ongoing restructuring efforts.

Niccol further stated that by the end of the fiscal year, Starbucks is expected to have nearly 18,300 stores in total, including company-operated and licensed outlets across the United States and Canada. Looking forward to fiscal year 2026, the company plans to expand its store count while continuing to invest in the business. Furthermore, Starbucks aims to renovate over 1,000 locations within the next 12 months to introduce enhanced design elements like increased texture, warmth, and layered aesthetics.

In conjunction with the store closures, Starbucks is also set to terminate around 900 current non-retail partner roles and close various open positions. The decision to reduce headcount and expenses reflects the company’s commitment to streamlining operations and improving overall efficiency. While a Starbucks spokesperson did not immediately provide specifics on the exact locations of the stores to be closed, this move is expected to have a noticeable impact on the workforce and the company’s operational footprint.

The decision to close a significant number of stores in North America underscores Starbucks’ proactive approach towards adapting to changing market dynamics and enhancing the customer experience. As the coffee giant embarks on this restructuring journey, stakeholders will be closely watching how these strategic changes unfold and the potential impact on the brand’s performance in the competitive coffee industry. Stay tuned for more updates on Starbucks’ store closures and ongoing business developments.

In conclusion, Starbucks’ announcement to shutter several North American stores by the end of the fiscal year marks a pivotal moment in the company’s evolution and strategic realignment efforts. With a focus on improving the in-store experience and operational efficiency, Starbucks is poised to navigate the changing retail landscape while continuing to delight customers with their signature coffee offerings.