Major Chain Lays Off 1,100 Employees as Sales Struggles Continue
Starbucks is forging ahead with plans to rejuvenate the brand with news 1,100 corporate employees are to be let go amidst poor sales and a drop in profit. CEO Brian Niccol announced the layoffs to workers via a note on Monday, telling them the move was designed to “operate more efficiently” and “reduce complexity”, according to The New York Times. The layoffs will impact 7% of the Starbucks’ 16,000 employees but will not affect the company’s baristas. “We believe it’s a necessary change to position Starbucks for future success,” Niccol said in his letter.
“We are simplifying our structure, removing layers and duplication and creating smaller, more nimble teams. Our intent is to operate more efficiently, increase accountability, reduce complexity and drive better integration.”
All Part of the “Back to Starbucks” Plan
Niccol is focused on his big ‘Back to Starbucks’ plan to save the iconic coffee chain, recently closing down 12 underperforming locations as part of the company’s back to basics approach. “I’ve spent my first several weeks in stores engaging with and listening to feedback from our partners and customers. It’s clear that Starbucks is a much-loved brand,” Niccols said after taking over as CEO. “We need to focus on what has always set us apart — a welcoming coffeehouse where people gather and where we serve the finest coffee, handcrafted by our skilled baristas. We are energized and the team is already moving quickly.”
In upcoming changes that will have more of an impact on customers, the Starbucks menu is being “optimized” and several items will be retired starting March 4, 2025. “Additional beverages and food will exit Starbucks menu throughout the coming months, resulting in a roughly 30% reduction of menu items in the U.S. by the end of fiscal year 2025 (Sept. 2025), to make way for innovation,” Starbucks told Eat This, Not That! in a statement.
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