Starbucks said on Monday it is shutting down 16 stores across the U.S. after workers reported incidents of drug use at certain locations.
Citing worker safety as the reason, the Seattle-based coffee chain said it will permanently shutter the stores in Seattle (6), Los Angeles (6), Portland (2), Philadelphia (1), and Washington D.C. (1) by the end of the month, and will transfer employees to other locations, according to the Wall Street Journal.
Starbucks is also rolling out a number of new safety measures like giving store managers leeway to close restrooms, limit seating, reduce operations, and even change store layouts in response to safety concerns. In addition, Starbucks will also provide guidance to baristas on how to deal with an active shooter scenario and lessons on conflict de-escalation.
“You’re seeing firsthand the challenges facing our communities—personal safety, racism, lack of access to healthcare, a growing mental health crisis, rising drug use, and more,” U.S. operations leads Debbie Stroud and Denise Nelson wrote in a message to U.S. employees.
“With stores in thousands of communities across the country, we know these challenges can, at times, play out within our stores too. We read every incident report you file—it’s a lot.”
Unionization effort overlaps
While the company has stated that the move to shut down the stores is part of policies aimed at addressing worker concerns about safety on the job, some of the closing locations also happen to be locations where Starbucks employees had recently voted to unionize.
Two of the Seattle stores which will be shut down voted to unionize while another location in Portland, Ore. also recently petitioned to hold a union vote, the Associated Press reported. Last month, Starbucks also closed a store in Ithica, N.Y. due to operational problems just weeks after it voted to unionize.
While Starbucks has actively opposed unionization efforts, since late last year more than 189 U.S. Starbucks locations have voted to unionize out of the roughly 9,000 locations Starbucks has around the U.S, according to the National Labor Relations Board.
Starbucks officials told the Associated Press that the recent closures were in no way related to unionization efforts. “Opening and closing stores is part of our business operations. This is really rooted in safe and welcoming stores,” a company official said.
Howard Schultz’s return
The topic of worker safety concerns first came up on the radar in collaboration “outreach” sessions, where Starbucks employees at all levels of the company come together to discuss pain points in their day-to-day work.
Outreach sessions “come as Starbucks is undergoing a company-wide transformation initiative,” Starbucks said on its company website, and began after chief executive Howard Schultz returned to the company earlier this year. Schultz stepped back into his role as CEO after Kevin Johnson, who was named chief executive in 2017, retired from the position on Apr. 4, 2022.
After reports came out Monday that Starbucks was shutting the 16 stores, Schultz hinted that more significant change were to come.
“We need to reinvent Starbucks for the future,” Schultz said in a letter seen by Restaurant Business, noting that the company finds itself “in a position where we must modernize and transform the Starbucks experience in our stores and recreate an environment that is relevant, welcoming and safe, and where we uplift one another with dignity, respect, and kindness.”
Schultz noted that the Starbucks of today is not set up to satisfy the evolving behaviors and needs of its partners and customers.
Schultz then mentions five moves the company is intending to take to revolutionize Starbucks: Re-envision how it brings its mission to life; renew the well-being of retail partners by improving their experience; reimagine its store experience for greater connection, ease, and a planet-positive impact; reconnect with its customers by delivering memorable and personalized moments; and redesign partnership by creating new ways to thrive together.
While the letter is scant on details on how Schultz plans to implement these changes, it can’t be dismissed. The last time Schultz returned was in 2008, after an eight-year hiatus. Upon his return, he led a mass-firing of executives and employees, shuttered hundreds of stores, aggressively expanded into Chinese markets, and introduced a national loyalty program.
Starbucks is expected to name a permanent replacement for the CEO position by the fall, who will take over the position by early next year.
