Starbucks is supposedly considering selling its UK operation as it faces increased competition and shifting customer patterns. Lockdown measures around the world have taken a heavy toll on the world’s largest coffee company.
Starbucks stated that the company was “not in a formal selling process for the UK business.”
According to the Times, the corporation will continue to “explore strategic options” for its corporate-owned international operations. According to the publication, Starbucks has hired Houlihan Lokey to investigate potential business opportunities. Houlihan Lokey, based in New York, declined to comment.
Starbucks has operated in the UK since 1998 and has over 1,000 shops, approximately 70% of which are franchisees and the remaining are owned by the company.
Measures to prevent the spread of Covid-19 impacted the chain hard, as they did many of the food and beverage takeaway industry. It, like its competitors, is struggling with increased costs as well as needing to adjust to changing client patterns as more individuals migrate to hybrid work-from-home schedules.
In the United Kingdom, the corporation is also facing rising rivalry from competing coffee companies such as Costa, Pret A Manger, and Tim Hortons.
However, the BBC believes that Starbucks is long-term committed to the UK and continues to invest in new shop openings, staff, innovative formats, and digital sales channels.
While it eliminated five company-operated stores last year, it established 14 new ones aimed at drive-through customers.
It claims that its company-operated openings will concentrate on significant city and drive-through locations.
Following the departure of Kevin Johnson earlier this year, the group is looking for a new permanent chief executive on a global scale. Former CEO Howard Schultz has been filling the post on an interim basis since April.
In the United States, the corporation has also been contending with recent unionisation efforts by some of its employees. Starbucks announced in May that it would quit Russia after 15 years due to the Ukraine conflict.
After stopping trading in Russia in March, the company announced that it will exit the country entirely.
Starbucks first entered Russia in 2007 and has since expanded to 130 licenced coffee outlets.
(Adapted from EconomicTimes.com)