Dubai – Qahwa World
In less than two days, Starbucks’ downsizing plan has expanded from North America to Europe. After announcing yesterday the closure of hundreds of stores in the United States and Canada, the company today revealed further closures in the UK, Switzerland, and Austria, underscoring the challenges facing the world’s largest coffee chain.
Starbucks’ EMEA division confirmed that a review of its company-owned stores in Europe, the Middle East, and Africa has resulted in a decision to shutter outlets in three key European markets. The company did not disclose how many stores will close or the exact timeline but stressed the move is part of a broader strategy to align store formats with customer traffic and profitability.
This announcement comes just one day after the company said it would close around 400 stores in the U.S. and Canada and cut 900 non-retail jobs as part of a $1 billion restructuring plan. Read yesterday’s report here
Numbers Tell the Story
Starbucks currently operates nearly 5,000 stores across 42 countries in the EMEA region. The UK is its largest market, with 1,416 stores (521 company-owned). Switzerland has 49 company-owned outlets, while Austria operates 21.
The financial strain is evident in recent results: UK revenues fell 4% year-on-year to £525.6m ($668.9m) for the year ending September 2024, with a pre-tax loss of £35.2m ($44.8m). Across EMEA, revenues declined 9%, gross profit fell 5%, and operating profit dropped 16%.
“Back to Starbucks” Strategy
The closures form part of CEO Brian Niccol’s Back to Starbucks strategy, first launched in late 2024, which aims to return the brand to its “coffeehouse roots.” The strategy emphasizes simpler menus, stronger barista engagement, and encouraging customers to spend more time in stores.
Despite the retrenchment, Starbucks insists it remains committed to expansion. The company plans to open 80 new UK stores and 150 additional EMEA outlets by the end of the current fiscal year on 30 September 2025, with a pledge to return to net positive store growth across the region in 2026.
