Iconic Coffee Chain Shutters Stores as 'Decline' in Traffic Worsens

Business is still slow for mega coffee chain Starbucks, with news the company is closing down stores nationwide after experiencing "pressures in both our top-line and bottom-line", according to its 2024 Q4 earnings report. "Despite our heightened investments, we were unable to change the trajectory of our traffic decline, resulting in pressures in both our top-line and bottom-line. While our efficiency efforts continued to produce according to plan, they were not enough to outpace the impact of the decline in traffic," said chief financial officer Rachel Ruggeri.

Ruggeri is confident the company can turn things around with more time for real change to happen. "We want to amplify our confidence in the business, and provide some certainty as we drive our turnaround. For that reason, we have increased our dividend."

As part of the new strategy overhaul, Starbucks recently reversed its open-door bathroom policy as per the new Coffeehouse Code of Conduct. "We know from customers that access to comfortable seating and a clean, safe environment is critical to the Starbucks experience they love," Sara Trilling, the president of Starbucks North America, wrote in a letter to store managers, according to The New York Times. "We've also heard from you, our partners, that there is a need to reset expectations for how our spaces should be used, and who uses them."

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Anyone who wants to use the Starbucks space must buy something, moving forward. "Starbucks spaces are for use by our partners and customers – this includes our cafes, patios and restrooms," the company says. "Our goal is to create a welcoming environment. We expect everyone to treat one another with respect and follow our code of conduct."

Chairman and chief executive officer Brian Niccol says the chain is currently pushing its 'Back to Starbucks' plan. "I've spent my first several weeks in stores engaging with and listening to feedback from our partners and customers. It's clear that Starbucks is a much-loved brand," he said. "We need to focus on what has always set us apart — a welcoming coffeehouse where people gather and where we serve the finest coffee, handcrafted by our skilled baristas. We are energized and the team is already moving quickly."