What's Known About Starbucks' 250 Store Closures and the Labor Questions Behind Them
Starbucks plans to close 250 North American stores later this week. The company calls it part of an ongoing turnaround. For workers, customers, and union organizers, the announcement raises more questions than it answers.
A second wave of closures
This is not Starbucks' first large round of shutdowns under Chairman and CEO Brian Niccol, who joined the company in 2024. Last September, Starbucks closed 627 stores in North America and Europe and laid off 900 non-retail employees. The new round of 250 closures is smaller, but it follows the same playbook.
In a letter to employees, Chief Operating Officer Mike Grams said the targeted locations either aren't delivering acceptable financial results or can't provide the kind of experience the company wants for customers and employees. He acknowledged that most stores are benefiting from momentum, but wrote that "some coffeehouses continue to underperform despite the hard work and commitment of all of you."
What Starbucks has not said
Starbucks did not say which coffeehouses will close. It also did not say how many of the affected locations are in the U.S., and it did not say how many of them are unionized.
That last silence matters. More than 700 U.S. Starbucks stores have voted to unionize since late 2021. Starbucks does not support the unionization effort, and the union and the company have yet to reach a labor agreement. Closing a unionized store can remove a bargaining unit entirely, which is why advocates watch closure lists closely. PBS NewsHour reported the company's lack of detail on unionized locations without additional comment.
What happens to employees
Starbucks says it will transfer employees to other stores if possible. If it cannot place someone in another location, the company says it will provide severance support.
The closures are not the only workforce change. In May, Starbucks laid off an additional 300 corporate employees and closed some underused U.S. offices. The retail cuts run parallel to a broader effort to reshape the company's operations under Niccol.
Why the closures fit a larger store strategy
Grams said Starbucks remains committed to growing its store count in North America. So this is not a retreat from physical retail. It is a pruning of locations the company believes are dragging down performance or damaging the brand experience.
At the same time, Starbucks is retrofitting its existing coffeehouses to make them cozier and more inviting. The company expects 1,500 stores will be retrofitted by Sept. 30, the end of its fiscal year.
The practical effects of the shutdowns will vary. Some neighborhoods will lose a familiar coffee stop. Some workers will transfer across town. Other employees may find themselves leaving the company entirely, possibly with severance. Because Starbucks has not published the store list, the impact remains uneven and uncertain.
What is clear is that this is a deliberate corporate reset: fewer underperforming locations, upgraded remaining ones, and a labor relationship that remains unresolved. The store closures are one part of that reset, and the union question attached to them is unlikely to disappear with the shuttered stores.