Starbucks closing stores in US and UK as part of major global restructure

Starbucks is closing stores in the United States, United Kingdom, Switzerland and Austria after a strategic review of its coffeehouse portfolio.

The closures, confirmed this week, come as the company pushes forward with its ‘Back to Starbucks’ strategy under chief executive Brian Niccol, who took the helm in September 2024.

The plan focuses on improving customer service, revamping store formats and ensuring locations meet financial and operational expectations.

In a letter to employees, Niccol said:

During the review, we identified coffeehouses where we’re unable to create the physical environment our customers and partners expect, or where we don’t see a path to financial performance, and these locations will be closed.”

The US, Starbucks’ largest and most important market, will see its company-operated store count decline by about 1 per cent this financial year. The coffee chain will end 2025 with around 18,300 locations across the US and Canada, though the company insists it will return to net growth in 2026.

In the UK and wider EMEA region, a similar review has led to decisions to close certain sites. At the same time, Starbucks says it remains committed to expansion, with 80 new UK stores and 150 more across EMEA expected to open this financial year.

“These decisions impact our partners (employees), their families and the communities where we operate, and we never take them lightly,” the company said in its statement. “We’ll do all we can to support those impacted by this change.”

Employees in affected coffeehouses have begun a consultation process. Starbucks has pledged to facilitate transfers to other stores where possible, with “enhanced compensation packages and wellbeing support” for those unable to be relocated.

Staff cuts

The store closures are accompanied by cuts to non-retail roles, with Starbucks confirming the elimination of around 900 non-retail jobs in North America. Niccol framed the move as part of efforts to “put our resources closest to the customer” and invest in frontline staff hours, upgraded coffeehouse designs and customer experience.

Earlier this year, Starbucks announced 1,100 job cuts and simplified its US menu to revive struggling sales. The challenges have continued, with the company reporting a sixth straight quarterly decline in same-store sales in July and its shares down more than 8 per cent so far this year.

“Going backwards under Brian Niccol’s leadership”

Not everyone agrees with the company’s strategy. Starbucks Workers United, which represents staff at more than 600 of Starbucks’ company-owned US stores, has been pushing for a contract agreement with the company.

The union has raised concerns about short staffing, overworked baristas and a lack of input from frontline employees.

This announcement makes it clear things are only going Backwards at Starbucks under Brian Niccol’s leadership. Yet again, we’re experiencing new policies and major decisions being made with zero barista input.

Workers United is sending a formal request for information to Starbucks about the planned closures. We expect to engage in effects bargaining for every impacted union store, as we have done elsewhere, so workers can be placed in another Starbucks store according to their preferences…

Fixing what’s broken at Starbucks isn’t possible without centring the people who engage with the company’s customers day in and day out.”