Nashville, September 26: American coffee giant Starbucks has announced the establishment of its first Global Capability Center (GCC) in Chennai, even as the company has closed nearly 250 stores in North America, eliminating about 900 positions as part of a broader turnaround strategy led by newly appointed CEO Brian Niccol.
This restructuring comes at a time when shifting consumer habits and inflationary pressures have forced the coffee chain to streamline its operations in an aim to reduce its overheads. The company has said it will try to transfer baristas to other locations where possible, while employees who are leaving will receive severance support. According to The Wall Street Journal, the latest layoffs of 900 jobs this year come after it eliminated about 2,000 roles last year, with many forced to go as they declined to relocate to its Nashville office.
For Starbucks, these reductions are part of a broader restructuring programme which has cost about $1 billion, with the company spending on employee separation benefits, lease-related costs and store asset impairments. The company is expected to cut about $2 billion in costs by the end of 2028, a target set by the CEO.
On the other hand, the GCC in Chennai is an investment aimed at driving technology development and specialized business solutions for its global operations. The company aims to hire about 800 professionals to support its technology development globally. This would be independent of Tata Consumer Products, the retail joint venture it has with the Tata’s for its presence in India.
