Starbucks cuts London, Hong Kong office jobs in restructuring effort
The company has said that it wants to double its international store count to about 40,000
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[CHICAGO] Starbucks laid off corporate workers in the London and Hong Kong hubs that oversee parts of its international business, as the coffee chain gives third-party licensees greater latitude to run its stores outside of North America.
The Seattle-based company cut about 20 per cent of staff, or approximately 60 positions, in the Hong Kong office that oversees the Asia-Pacific region excluding China and Japan, according to sources familiar with the matter. It also eliminated about 120 positions in London, the headquarters of its Europe, Middle East and Africa operations.
Starbucks has been restructuring its corporate teams to cut costs and eliminate what it says are duplicative layers of management and jobs focused on coordinating work. Its sales have rebounded from a lengthy slump as it launched new products, revamped its marketing and rolled out an initiative to remodel stores.
Starbucks declined to comment beyond its global restructuring announcement in May, when it revealed its latest round of job cuts in the US and said that it was reviewing its international corporate teams.
Outside of North America, the company is moving away from directly running its stores, giving licensees greater oversight over the business instead. It’s a way to free up time and money to spend on its company-owned locations, which are heavily concentrated in the US.
The company has said that it wants to double its international store count to about 40,000, mostly through third-party partners.
Last year, Starbucks entered into a joint venture for its China business, and it’s examining options for its Japan operations, Bloomberg News has reported.
As part of the restructuring plan, the company is moving some job responsibilities into the remit of licensees or of corporate teams in offices such as Seattle that serve multiple geographies.
It is not clear how many employees will remain in the London office.
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Comparable sales for Starbucks’ international business grew about 3 per cent in the three-month period to Mar 29, marking three straight quarters of growth.
Starbucks shares, which closed at US$100.65 in New York trading on Thursday, have gained 20 per cent so far this year. BLOOMBERG
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