Starbucks Corp. cut its corporate staff by five percent Tuesday, following through on restructuring plans announced earlier this fall.
In a memo to all employees at the chain’s Seattle Support Center and Global Non-Retail Partners, CEO Kevin Johnson said about 350 employees, mostly at the Seattle headquarters, would be losing their jobs. Those roles make up about five percent of the company’s corporate staff, according to the company.
The Starbucks memo said the layoffs would be in the areas of marketing, creative, product, technology and store development. The changes will not affect roles at the store level, the company said.
“Building the next chapter of Starbucks requires us to focus on fewer priorities and transform how our functional teams work in order to accelerate the velocity of innovation that is relevant to our customers, inspiring to our partners [employees], and meaningful to our business,” he said.
Johnson had indicated previously that a corporate restructuring was underway. In September he said in an internal memo that he would “make some significant changes to how we work as leaders in all areas of the company and how functional groups are structured to support our retails sales.”
At the time he said the changes were being made to “increase the velocity of innovation that is relevant to our customers, inspires our partners, and is meaningful to our business.”
Starbucks has had a challenging year, with declining traffic during the afternoon amid a sales slump in the chain’s signature Frappuccino slush drinks.
It also received negative publicity after a racial profiling incident in a cafe in Philadelphia involving the arrests of two African-American men. The corporate office responded with anti-bias training at roughly 8,000 of its restaurants.
However, it did close out the fiscal year, ended Sept. 30, with quarterly global same-store sales up by 3 percent, driven by a 4 percent rise in comps for the Americas.
There are more than 29,000 Starbucks locations worldwide with around 350,000 employees.
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