Starbucks closes 400 stores across US

After years of aggressive urban expansion, Starbucks has decided to change its strategy and close hundreds of its outlets across major US cities. The move came after sales started going down, rising costs of the company.

Starbucks was first found in Seattle, later opened stores in every busy corner of New York City and Los Angeles. It’s strategy at first was targeting commuters in these busy cities, the strategy is now being revised. 

CEO Brian Niccol, ordered shutting of roughly 400 stores nationwide as part of a $1 billion restructuring plan.

42 locations in New York alone have been shut down. According to reports, Starbucks has lost its position as largest coffee chain to Dunkin Donuts in Manhattan, Chicago, San Francisco, Minneapolis and Baltimore.

Competition from independent cafes, remote work culture thinning out the number of daily commuter traffic and high cost of operating in city centers are some of the major reasons for the said move. 

Howard Schultz, former executive of Starbucks, has also pointed to safety and public restroom concerns as challenges in urban stores.

The CEO, Brian Niccol is now repositioning Starbucks as a renewed “third place” between home and work, while shifting growth toward suburban, drive-through locations where costs are lower. The company says it will remodel about 1,000 US stores and open new ones in 2026 with updated designs, aiming to revive the brand after its major downfall.