Seattle, Washington -Starbucks laid off 350 corporate employees on Tuesday as a part of its corporate reorganization agenda. This figure represents about 5% of the coffee giant’s corporate workforce, raising questions about the health of the company as a whole.
The expected changes in regard to layoffs were announced earlier this fall. The world’s biggest coffeehouse company spent the fall on reviewing its corporate team, starting from senior vice president and vice president level. Both of these levels are under heavy pressure to accelerate sales growth.
Most expected retail store level employees to keep their jobs. Most of the layoffs were expected for the company’s Sodo headquarters. The company did not provide specific details, but it laid off an unspecified number of senior executives in September.
Starbucks Is Making Big Changes in Seattle and Beyond
The wave of unexpected changes by the biggest coffee chain company surprised employees. One employee, who asked to remain anonymous, said she had an hour to turn in company equipment and leave the building. This practice was in sharp contrast with the earliest layoffs, when employees received more advanced notice.
According to chief operating Rosalind Brewer, some of the organizational changes increased fourth-quarter sales on November 1. Certain marketing, customer, and employee analytic efforts contributed to these improvements. However, it is unclear for how long these improvements will hold. Sales changes are hard to predict, and it very well could simply be colder weather that led more people to buy from Starbucks in the Seattle fall.
Although Starbucks began in Seattle, it has grown beyond those roots to become one of the world’s largest companies. Before these layoffs, Starbucks transferred more than 500 employees to Nestle in the US and Europe. The increasingly global company has massive influence over multiple industries, so seeing it downsize like this might concern some.