Starbucks announced on Monday that it will lay off 1,100 corporate employees by Tuesday morning and eliminate hundreds of open roles. In a letter to employees, CEO Brian Niccol stated that the company is simplifying its structure by removing redundant roles and forming smaller, more agile teams. The layoffs will not impact store employees, and the company did not specify how many Seattle-area workers would be affected. Niccol emphasized that the move is necessary to position Starbucks for future success.
The layoffs are part of Niccol’s “Back to Starbucks” campaign, which focuses on streamlining operations, simplifying menus, revising pricing structures, and remodeling cafes to evoke nostalgia from the company’s early days. Niccol, who joined in September after a challenging year for the coffee giant, aims to increase efficiency, accountability, and integration within the company.
Starbucks expects to notify affected employees by Tuesday morning. Corporate employees were advised not to come to the office this week unless instructed otherwise. The company will continue to provide pay and benefits to laid-off workers through at least May 2. Affected employees will have one-on-one meetings on Tuesday to discuss severance and career support resources.
Niccol also addressed the company’s hybrid work policy, maintaining the rule of three days in the office per week but signaling stricter enforcement for executives. Employees at the director level and below with remote status will retain it, but future roles will require employees to be based in Seattle or Toronto.
Starbucks reported a 4% decline in sales at its cafes during the last quarter of 2024 compared to the previous year, with profit-per-share dropping 23%. However, Niccol noted that the dip in sales was less severe than in prior quarters, viewing it as a positive sign for the turnaround efforts. — news from The Seattle Times