Starbucks is closing its stores in the USA and Europe
Due to financial difficulties, Starbucks is forced to close many of its coffee shops in the US and Europe. This was reported by Zamin.uz.
According to the company's official statement, currently 900 employees will be laid off in the US, and by the end of the month approximately 400 stores in North America will cease operations. It is also mentioned that some branches in Europe may be closed.
Starbucks management emphasized that these decisions were made to reduce costs and increase sales volume in profitable regions. The new arrangement will create conveniences for customers and significantly reduce waiting times during the coffee purchasing process.
Additionally, in February, 1,100 jobs were cut in the US and the menu was optimized. As a result, the company is forced to give up more than 2,000 jobs in the country within a year.
According to CEO Bryan Niccol, the new cuts will cover not only the US but also some coffee shops in the UK, Switzerland, and Austria. At the same time, the company has not abandoned plans to open 80 new branches in the UK and a total of 150 new branches in Europe, the Middle East, and Africa.
According to the company's July report, sales have been declining for six consecutive quarters in stores that have been open for more than a year in the US. This market is considered the most important for Starbucks.
As a result of the sales decline, the company's shares have dropped by 8 percent since the beginning of the year. Financial analysts explain this situation with several factors.
Among them, TD Cowen experts believe that "drive-thru" format cafes, which allow customers to buy coffee without leaving their cars, represent strong competition for Starbucks in the US. Also, surveys conducted among customers showed that more than 70 percent of buyers have reduced visits to Starbucks due to high prices.
Furthermore, in some cities, Starbucks baristas have begun openly expressing their dissatisfaction through labor unions. This is creating additional problems for the company.
The labor market situation in the US is also complicated, and according to the latest official statistics, unemployment and layoff rates are worse than expected. Many analysts associate this with President Donald Trump's trade policy.
Overall, Starbucks faces serious problems. The company is striving to ensure financial stability through layoffs and to maintain brand reputation by opening new stores.
