Starbucks store closures hit 250 cafes this week

Starbucks starts closing 250 underperforming stores across the United States and Canada this week, a second wave of cuts since chief executive Brian Niccol took over in September 2024.

The closures affect about 1% of Starbucks' roughly 18,000 North American locations, according to a securities filing made this week. The company said the affected sites did not "deliver the experience we want for customers and partners," without naming individual stores.

Starbucks expects to book around $300 million in restructuring charges tied to the closures, the filing shows. The company said it will try to transfer baristas from shuttered cafes to other locations and offer severance to those who leave.

Closing stores is easier than fixing why customers stopped coming.

Last September, Starbucks closed 627 stores across North America and Europe and cut 900 corporate jobs in an earlier round of the same restructuring. This week's 250 store closures bring the total lost footprint under Niccol past 800 cafes in twelve months.

A retreat from rapid expansion

The chain built its US footprint through more than two decades of dense urban expansion, at times opening several stores within walking distance of each other. Analysts say the closures mark a retreat from that model after same-store sales fell for multiple consecutive quarters.

The pattern echoes Red Lobster's own retrenchment earlier this year, when the casual-dining chain shed dozens of locations to cut fixed costs rather than chase new openings.

Independent operators have taken the opposite path. Go Get Em Tiger's move to roast coffee at origin shows smaller chains investing in supply chains just as Starbucks trims its store count.

Baristas learn with days' notice

Starbucks Workers United, the union representing baristas at more than 550 US stores, said members at some affected cafes learned of the closures with only days' notice, a complaint it has raised during previous restructuring rounds.

Starbucks has not published a store-by-store list, saying only that the closures are spread across the United States and Canada. The company reports full-year results in late October, when investors will look for signs the cuts are stabilising traffic rather than simply shrinking the business.