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Starbucks announces plans to shrink

Illustration for article titled Starbucks announces plans to shrink
Photo: Yuriko Nakao (Getty Images)

In a May 21 letter to employees, Starbucks CEO Kevin Johnson stressed that humanity must embrace change in the face of adversity, citing the construction of the Transcontinental Railroad, the discovery of a polio vaccine, and the Space Race as examples of innovations that united our nation. So, too, must Starbucks step up during these unprecedented times, facing down the menace of COVID-19 by adding more drive-thrus and pickup-only stores over the next 18 months.

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Starbucks has actually been planning this transition for a while, introducing its first 100% mobile order pickup concept in New York City’s Penn Station late last year. In a statement posted yesterday on its website, the company followed up Johnson’s May letter with an official announcement that it will now be accelerating its transformation timeline from 3-5 years down to 12-18 months. According to an SEC filing, 400 underperforming Starbucks locations in the U.S. and Canada will be shuttered and 300 new, more streamlined locations will be opened during this time.

According on Johnson, before the COVID-19 crisis, 80% of store transactions were to-go orders, which was the impetus behind the changes we’ll all soon be seeing in Starbucks cafes. There were existing plans to close low-traffic locations, such as those found in shopping malls, and open new ones in areas that can combine indoor seating with drive-thru. In dense metro areas, more stores will be converted into pickup-only concepts like the one in Penn Station, with some locations closing entirely, and new ones opening in smaller retail footprints.

Allison Robicelli is The Takeout staff writer, a former professional chef, author of three books, and The People's Hot Pocket Princess. Questions about recipes/need cooking advice? Tweet @Robicellis.

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DISCUSSION

emchammered
E=MC Hammered

I lived in DC for a couple years in the early 2000s when I was fresh out of college and worked for a media company on 15th between K and L streets. At one point my parents came out from California to visit me and they wanted to see where I worked, so I brought them to that part of the city. They spent a week in DC and I took them by all the usual tourist attractions and landmarks and to this day there are three things they still talk about from that trip the most:

1. My dad getting kicked out of the Lincoln Memorial for pretending to cut down one of the pillars with an invisible chainsaw while shirtless;
2. The height of the escalator at the Woodley Park Metro stop;
3. How they could literally see five different Starbucks while standing on the corner of 15th and K.

Now I live in a different city, and while it’s not quite that bad, there are four different Starbucks within four blocks of my office.

I guess what I’m saying is, we can probably stand to lose some Starbucks locations...