NEW YORK: Starbucks will cut 1,100 corporate and administrative jobs as part of a reorganisation as it aims to reignite sales growth, the company’s new CEO said Monday.
The coffee giant is taking “the hard decision to eliminate 1,100 current support partner roles and several hundred additional open and unfilled positions,” said chief executive Brian Niccol in a message to employees.
The move will not affect front-line coffee servers, known as “baristas” in Starbucks lingo. As of September 2024, Starbucks employed 361,000 workers, including 16,000 in administrative and support positions.
Niccol joined Starbucks in September 2024 as part of a leadership shakeup as the chain contends with sagging sales.
In the most recent quarter, Starbucks reported a drop in profits following a 4% decline in global comparable store sales.
In a Jan 28 earnings conference call, Niccol touted various pilot programme tests to reinvigorate the chain by speeding customer service and restoring more personal touches, such as notes from coffee baristas to customers.
“We are simplifying our structure, removing layers and duplication and creating smaller, more nimble teams,” Niccol said in Monday’s message.
“Our intent is to operate more efficiently, increase accountability, reduce complexity and drive better integration.”
Starbucks also plans to scale back its offerings.
The company is removing “a selection of less popular beverages from our menu, such as some Frappuccino-blended drinks that “aren’t commonly purchased, can be complex to make, or are like other beverages on our menu,” according to the company’s website.
Shares of Starbucks rose 1.6% shortly after midday.
