Over the past two years, dozens of Starbucks locations have permanently closed. But this isn’t due to poor financial performance of the global coffee corporation as a whole that generated almost $22 billion in revenue in 2022. The shutdowns are regional and due to a variety of factors including work safety and a response to certain locations choosing to unionize.
Here’s why select Starbucks location are permanently hanging up their green aprons. If you’re worried your favorite coffee chain is struggling from a business perspective, don’t be concerned. The coffee giant continues to see increase sales and units globally.
Reasons for Starbucks Locations Closing
Starbucks cited “safety issues” for closing down some of their locations. These safety issues involve vandalism, crime, and property theft happening in the area where their stores are located.
News of Starbucks stores closing nationwide have been around since last year but it’s making rounds again as a location in Studio City, Los Angeles is making waves for removing customer seating and the only option that the coffee shop is providing is for to-go orders only. This lead to people wondering if the location was also about to close down although the sign posted on the door said it was only temporary.
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This was the only statement that a Starbucks spokesperson was able to give out: “Our local leaders are, and have always been, empowered to use the many resources at their disposal to modify store operations and create the best experience for our communities. Our first priority is to make sure our partners are safe at work. We will continue to work to make sure that partners can focus on crafting exquisite beverages and creating connections in a safe, warm, and welcoming environment.”
In 2022, Starbucks announced that they were closing 16 of their stores in the United States. These locations are:
- Santa Monica & Westmount (8595 Santa Monica Blvd. West Hollywood)
- Hollywood & Western (5453 Hollywood Blvd., D, Los Angeles)
- Double Tree Hotel at 1st & Los Angeles (120 S Los Angeles St., #110, Downtown L.A.)
- Hollywood & Vine (6290 Hollywood Blvd., Hollywood)
- Ocean Front Walk & Moss (1601 Ocean Front Walk, Santa Monica)
- 2nd and San Pedro (232 E 2nd St., Downtown L.A.)
- 10th & Chestnut (1001-1005 Chestnut St., Philadelphia, Pa.)
- Union Station Train Concourse (50 Massachusetts Ave NE., Washington, D.C.)
- 4th & Morrison (401 SW Morrison St., Portland)
- Gateway Shopping Center (10112 NE Halsey St., Portland)
- 23rd & Jackson (2300 S Jackson St., Seattle)
- Roosevelt Square (6417 Roosevelt Way NE, Seattle)
- East Olive Way (1600 E Olive Way, Seattle)
- 505 Union Station (Union Station, 505 5th Ave S #505, Seattle)
- Westlake Center (400 Pine St., Seattle)
- Hwy 99 & Airport Rd (11802 Evergreen Way, Everett)
What are the Concerns of Workers?
A part time worker for a Santa Clarita Starbucks said that the Studio City location’s move to offer to-go orders at the moment was understandable since they were also facing the same issues about worker safety. The issues she cited in the interview were homeless people and that it becomes a concern if they turn aggressive.
If you’ve ever visited a Starbucks location in California (or pretty much any big city), you know they attract members of the local homeless community. One reasons is that Starbucks locations typically have clean bathrooms and also provide free water to guests upon request. They also provide a source of electricity where individuals can recharge their phones, get access to the internet and of course get escape the extreme heat or cold.
A Hollywood resident also stated that the coffee shop had issues with people doing drugs in the café’s bathrooms and that police would come around a lot. Though no workers were interviewed on the scene, one can just assume that apart from working at the café, they would also have to deal with these issues on a regular basis.
Some Stores are Trying to Unionize
However, despite Starbucks already citing safety issues as a concern for closing some of their stores, many assume it is also in relation to the unionization of employees in some Starbucks’ stores. Out of 9,000 stores in the U.S., over 100 have decided to unionize. In recent months, Starbucks has been accused of “union busting” in an effort to discourage workers from seeking collective bargaining agreements.
Worker safety has been a concern at some locations.
Three of the Starbucks stores in Ithaca, New York which were all unionized have been shut down. Starbucks’ press release stated that they were to “close and evolve our stores as we assess, reposition and strengthen our store portfolio” but it has been over a year since they’ve reopened.
Currently, there are workers’ strikes happening in several Starbucks stores. Last June, the Seattle Starbucks Roastery was shut down due to a strike. This was in lieu of Starbucks allegedly not allowing Pride decorations in their coffee shops. More than 150 Starbucks cafes are expected to close due to these strikes.
What Do Unionized Workers Want?
The unionization effort among Starbucks employees seeks to address and rectify a range of workplace issues through collective bargaining and the establishment of a national framework of agreements with Starbucks across the country. Here are a few of the core demands sbworkersunited.org is seeking.
Movement for Change: Starbucks partners initiated a movement to bring about change in their workplace.
More Collaboration: Over the past few months, unionized Starbucks partners have been meeting and sharing ideas on how to enhance conditions for both partners and customers.
Fix Common Issues: The article points out that Starbucks workers, regardless of their location in the U.S., face similar challenges. These include: short staffing, unpredictable schedules, low wages, unaffordable healthcare, sexual and racial harassment, broken equipment, unfair discipline, workplace favoritism.
Create a National Framework: Due to these common issues, the union is aiming to establish a national framework of agreements with Starbucks to address and resolve these challenges.
Is Starbucks Continuing to Expand?
Despite all these news of some Starbucks stores closing down, the mega coffee chain is doing just fine. There has also been news of expansion in financial journals and revenues is continue to grow year over year.
In the U.S., Starbucks is aiming to reach 2,000 stores by 2025. This was announced last year during their Investor Day conference in Seattle. They’re also planning to invest $450 million to modernize their existing stores nationwide which includes improving and expanding their ordering system via their mobile app. More drive-thrus, pick up locations, and delivery-only locations are also being developed.
Fall drinks at Starbucks.
In the global sector, Starbucks has opened their 5,000th store in Gwangyang-si, South Korea. Group president of International and Channel Development for Starbucks Michael Conway said, “The opening of our 5,000th store in Asia Pacific reaffirms our commitment to bring the unparalleled Starbucks Experience to more customers in one of our fastest growing regions.”
Conway also added, “Asia Pacific is a dynamic and diverse engine of growth for Starbucks globally. As recovery continues, the region achieved over 20% sales growth year on year, demonstrating the strength and relevance of the brand. We are well positioned for further growth with our licensed business partners, who continue to elevate the Starbucks Experience across a range of innovative store formats.”
Starbucks is also planning to add 400 stores in Asia Pacific. They’re also planning to expand beyond the major cities of Thailand, Philippines, Malaysia, and Indonesia.
How is Starbucks Financial Performance?
Inside a Starbucks.
According to earnings announcements, Starbucks reached $21.933 billion in annual gross profit for the year 2022. This is a 7.93% increase from their 2021 revenue which over $20+ billion. Revenues have continued to increase since 2010 but took a dip in 2020 when the pandemic happened.
There are no Starbucks stores that are franchised and you can check out our breakdown here that provides an overview about licensing options.
Hopefully the crime in the Starbucks locations mentioned above could be given a solution by the government. In addition, may Starbucks reach a fair compromise with their staff in regards to their work setup and treatment so the strikes could stop and they can resume their business serving coffee and customers.