Starbucks to Lay Off 1100 Employees—Will Canada Be Affected?

Starbucks is laying off 1,100 corporate employees worldwide to streamline operations and improve efficiency. The cuts exclude baristas, roasting, and warehouse staff. Affected employees will be notified by mid-Tuesday, with additional unfilled positions also eliminated. CEO Brian Niccol aims to simplify Starbucks’ structure, enhance decision-making, and improve service speed. There’s no confirmation yet on whether Canadian employees will be impacted. The move follows declining sales, customer dissatisfaction with price hikes, and increased competition, particularly in China.

CONTENT:

• Starbucks Revamps Menu and Workforce to Enhance Efficiency

Starbucks to Lay Off 1100 Employees—Will Canada Be Affected?

Starbucks is set to lay off 1,100 employees worldwide, according to a letter sent to staff on Monday by CEO and chairman Brian Niccol. The company will also eliminate several hundred vacant, unfilled positions as part of a broader effort to streamline operations.

Niccol explained that the restructuring aims to simplify Starbucks’ corporate structure, remove redundant roles, and create smaller, more agile teams. The goal, he said, is to enhance efficiency, increase accountability, and improve integration to better focus on key priorities.

A Starbucks spokesperson told Global News that there is no information yet on whether Canadian employees will be affected. However, Niccol’s letter did outline new expectations for leadership in North America, requiring vice president-level and higher executives to be physically present in the company’s Seattle and Toronto offices at least three days a week.

While current employees will retain their hybrid or remote work arrangements, Niccol indicated that future hires—except for roles designated as fully remote—must be based in Seattle or Toronto.

Starbucks employs approximately 16,000 corporate support staff globally, though not all are impacted by the layoffs. Store employees, including baristas, as well as roasting and warehouse staff, are not part of the job cuts.

Niccol had previously signaled that corporate layoffs would be announced by early March, emphasizing the need to restructure so that decision-making is overseen by key leaders while reducing complexity and internal bottlenecks.

Starbucks brought Niccol on board last fall to address declining sales. His strategy includes improving service speeds, particularly during peak morning hours, revamping stores as community hubs, streamlining the menu, and adjusting ordering algorithms to better manage in-store, mobile, and drive-thru demand.

The coffee giant saw its global same-store sales decline by 2% in the 2024 fiscal year, which ended on September 29. In the U.S., rising prices and longer wait times contributed to customer dissatisfaction, while in China—the company’s second-largest market—competition from more affordable rivals intensified.

Starbucks’ decision to cut jobs comes as part of a broader strategy to improve operational efficiency and adapt to shifting consumer preferences. The layoffs primarily target corporate roles, as the company looks to reduce layers of management and improve decision-making speed. Niccol emphasized that these changes will enable Starbucks to operate with a leaner structure, allowing teams to focus on core business objectives and respond more quickly to market challenges.

The restructuring follows a period of declining sales and increased competition, particularly in key markets like the U.S. and China. Many American customers have expressed frustration over frequent price hikes and extended wait times, leading some to seek alternatives. Meanwhile, in China, Starbucks faces stiff competition from lower-cost coffee chains such as Luckin Coffee, which has rapidly expanded its market presence.

In addition to layoffs, Starbucks is making several operational changes to boost efficiency. The company is refining its digital ordering system to better balance mobile, in-store, and drive-thru orders. It is also simplifying its menu, removing less popular items to streamline kitchen operations and reduce wait times.

Despite the layoffs, Starbucks remains committed to its long-term growth strategy, investing in store renovations, new technology, and employee training programs. The company is also expanding its presence in emerging markets, where demand for premium coffee continues to grow. Niccol believes these initiatives will help Starbucks regain its competitive edge and drive sustainable growth in the years ahead.

Starbucks Revamps Menu and Workforce to Enhance Efficiency

Starbucks is making major adjustments to both its menu and workforce to improve quality and streamline operations. Beginning March 4, the company will remove 13 drinks from its offerings to simplify choices, enhance efficiency, and maintain consistency. According to Starbucks, these beverages were either infrequently ordered, complex to prepare, or too similar to existing options. This is just the first step in a broader menu revamp, as the company plans to phase out additional food and drink items over the next several months, ultimately reducing its menu by about 30% by the end of September.

In addition to these changes, CEO Brian Niccol announced a corporate restructuring that includes eliminating 1,100 corporate and support roles, along with several hundred unfilled positions, though baristas and in-store staff will not be affected. For customers disappointed by the menu cuts, Starbucks has recommended alternative drinks with similar flavors and textures, such as Green Tea Lemonade in place of Iced Matcha Lemonade and Mocha Frappuccino as an alternative to Java Chip Frappuccino.

Other substitutes include the Vanilla Bean or Strawberry Frappuccino for discontinued Crème Frappuccinos and the London Fog Latte as a replacement for the Royal English Breakfast Latte. These strategic changes are part of Starbucks’ broader effort to optimize operations while staying true to its identity as a coffee-focused brand.