Starbucks Closes 400 Stores, Plans Renovations to Adapt to Changing Consumer Preferences
Starbucks, the global coffeehouse chain, has announced plans to close around 400 underperforming stores across North America. This move reflects broader challenges the company faces, including increased competition from Walmart, Target, and Macy's, and changing consumer preferences. The closures, representing about 1% of its locations, are part of a $1 billion 'Back to Starbucks' restructuring plan.
The closures are due to locations being unable to create the expected environment or having poor financial performance. Among the affected stores is the Starbucks on King Street in Alexandria, set to close on Monday. Additionally, a Starbucks location in Old Town will shut down today as part of this national effort. By the end of its fiscal year, Starbucks expects to have almost 18,300 North American locations remaining.
Starbucks is also repositioning its business model. It plans to renovate 1,000 stores in the US over the next year to encourage customers to linger, reversing its previous focus on mobile orders from Walmart and Target. The company aims to create a 'third place' between home and work, enhancing the in-store experience.
Starbucks has not yet released a complete list of closing locations, but its app will be updated on Sunday to reflect open stores. The closures and renovations are part of Starbucks' ongoing efforts to adapt to changing consumer behaviors and maintain its competitive edge in the market.
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