Starbucks To Close 300 Canadian Stores

By Ben Hamill - January 15 2021
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Multinational coffeehouse chain Starbucks says it plans to complete its planned store closures of as many as 300 stores by the end of March. The Seattle-headquartered corporation previously announced that it would be shuttering up to 200 of its Canadian locations over the span of two years, but recently upped this number to a hundred more.

Said closures are in keeping with its plans of speeding up its so-called “transformation strategy”, a strategy initially spread out over 5 years, and one it announced would be intensified at the height of the global health crisis. Tuesday’s statement confirms that many Canadian Starbucks locations were indeed closed last fall, and that the remaining stores earmarked for cancellation would be shuttered by the close of the second quarter of 2021.

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Adapting To A New Reality

The company also provided an update on its plans for adding new drive thru locales as part of the wider restructure, which restructure includes a business model focusing more intensely on deliveries. Starbucks began experimenting with pick-up only coffee shops even before the global crisis hit. It opened the first Canadian location using the new model in Toronto’s business district in January last year. The first Toronto pick-up store measures only 93 square metres (1,000 square feet).

Starbucks says it believes the planned changes, which of which are already in motion, will help the chain to better accommodate customers in a way that is relevant to a new reality. It also says it regards the changes to be the laying of a foundation to a “transformational phase” that will help the coffee giant build corporate resilience.

Pick-Up Stores The New Way

Starbucks’ pick-up-only stores are outlined in such a way that they are able to cater to customers who prefer ordering before they arrive at an actual store. Customers do this by making use of the company’s easy-to-use mobile ordering app.

According to an update provided to investors late last year, the initial test stores have provided the chain with definite insights into how it can integrate the new format with its existing business model in a commercially optimal way. While the chain said it originally planned to implement the new strategy over a five-year timeframe, a new reality had accelerated the need for a more appropriate contact-free way of serving customers.

The company also said that while its plans to open more new stores in China as well as several other parts of the world remain ongoing, it would continue to slow down on structural storefront growth in the U.S. and North America.

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