Starbucks Closes 400 Stores After Loss During Coronavirus Lockdown

Starbucks, the company is popularly known for its cafes across the US, has recently announced that it will be closing around four hundred of its stores in different locations in the States as well as Canada in the upcoming eighteen months.

In addition, Starbucks also plans to increase its pickup and delivery services to cater to the rising demands of people during the coronavirus lockdown, which has changed people’s behavior and trends significantly not only in the US but around the world.

According to the company’s SEC filing, with the closing of the conventional four hundred cafes, there is also a plan for three hundred additional branches that specialize in takeaways and deliveries.

More precisely, Starbucks has stated in the filing that “This repositioning will include the closure of up to 400 company-operated stores over the next 18 months in conjunction with the opening, over time, of a greater number of new, repositioned stores in different locations and with innovative store formats,”

Furthermore, the company has also explained that the change is done primarily to increase retail presence, improve customer care and experience, as well as secure profits in the future.

However, the planning of closing cafe and opening takeaway-based stores was reportedly done before the beginning of the current coronavirus pandemic since a major portion of the population preferred the take-and-go option rather than dining in, in all big cities.

In accordance with an email written by Starbucks to CNN Business, nearly eighty percent of the transactions at around fifteen thousand Starbucks cafes are from coffee or other items bought on the go.

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One of the Starbucks spokespeople also recently said that the company already had plans to change in accordance with trends of the future and that the coronavirus pandemic only made Starbucks follow the plans much quicker than before.

In the new designs for on-the-go stores, Starbucks plans to provide better options and improved experience which may also help in fewer crowds of people in the conventional-style cafes.

Ultimately, all of the major cities will have multiple traditional cafes as well as on-the-go stores for catering to people with different needs.

In addition to the reports on changing business strategies and plans to adjust to changing behaviors and trends, Starbucks also stated that it suffered a loss of over three billion during the three months of coronavirus lockdown.

After closing stores in March due to coronavirus spread and social distancing policy, the company estimated that the sales went down by forty-three percent in May in comparison with May of 2019.

Now, since the lockdown restrictions have eased in many of the states, Starbucks has reopened around ninety-five percent of its stores which has improved the sales again.

With each passing week, the company has been seen to get back on track while making future plans that can help it grow substantially even during times of crisis such as coronavirus pandemic.

In the future, many other countries are also expected the new model of Starbucks in order to adjust to changing trends as well as to keep businesses strong just in case of future outbreaks that can cause similar lockdowns.


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