Starbucks (SBUX, Financial) Chairman and CEO, Brian Niccol, announced a restructuring plan that includes cutting 1,100 jobs to rejuvenate sales growth. The job cuts are part of the company's "Return to Starbucks" initiative aimed at enhancing operational efficiency and accountability. Niccol emphasized the need to streamline the organization by reducing layers and redundancies, thereby creating smaller, more agile teams.
The layoffs will not affect baristas in Starbucks stores, and impacted employees will be notified soon. The restructuring efforts are primarily focused on the global support teams. Starbucks China, however, is not included in this global communication. The company remains optimistic about the Chinese market's potential and plans to maintain its strategy of high-quality and sustainable growth there.
Since taking over in September, Niccol has been working to revitalize Starbucks' performance through various reforms and experience upgrades in U.S. stores. Despite the intense market competition in China, Starbucks plans to increase promotions, expand its store footprint, and invest in digital upgrades to capture more market share. In the fiscal year 2024, Starbucks China reported $2.958 billion in revenue, a 1.4% decrease year-over-year, but achieved a record net addition of 790 stores, marking a 12% growth.
