Starbucks has announced plans to lay off 1,100 corporate employees and cut nearly a third of its US menu as part of a major effort to turn around struggling sales in its home market. The job cuts, the largest in the company’s history, will not affect baristas, warehouse, or roasting employees but will focus on corporate “support partner” roles. The company is also eliminating several hundred vacant positions.
The move follows a sustained decline in US sales, with transactions at Starbucks stores open for at least a year falling 8% in the most recent quarter compared with the same period in 2023. CEO Brian Niccol, who previously led Chipotle, took over last year and has been pushing for operational efficiency and a return to Starbucks’ roots as a coffee-focused company.
Alongside job cuts, Starbucks is simplifying its menu, removing less popular and complex-to-make drinks such as the Royal English Breakfast Latte, White Hot Chocolate, and select blended Frappuccinos. More items will be removed over the next year, with changes going into effect from 4 March. The company aims to reduce wait times, improve quality, and align with its core identity.
“We’re simplifying our menu to focus on fewer, more popular items, executed with excellence,” Starbucks said in a statement. “This will make way for innovation, help reduce wait times, improve quality and consistency, and align with our core identity as a coffee company.”
Niccol has also overseen a shift in Starbucks’ handling of unionisation efforts, as over 500 stores with more than 10,500 workers have unionised since 2021 under Starbucks Workers United. Contract negotiations have stalled, with workers striking over the holiday season in December to demand better wages and benefits. Meanwhile, the company has faced boycott calls from both pro-Israel and pro-Palestinian groups amid the Israel-Gaza conflict, despite efforts to remain neutral.
With sales falling and operational complexity mounting, Starbucks’ latest strategy marks a departure from past efforts to encourage highly personalised drink orders. The company is also experimenting with new ordering algorithms to further improve service times.
Starbucks operates more than 40,000 stores worldwide and employs over 360,000 people. The company said affected corporate employees would be informed of the job cuts by mid-day Tuesday.
