Starbucks May Be Selling Its UK Stores. Here's What We Know
If you love caffeine, then chances are you've sipped a Starbucks drink or two over the years. With a lengthy beverage menu that spans from cappuccinos to flat whites to iced chai to, of course, the chain's signature 1995-launched blended Frappuccinos, Starbucks has a drink for every taste. The chain has also greatly expanded its food choices over the decades, currently offering snacks, pastries, and sandwiches, too.
With all those options for so many palates, it's no wonder that Starbucks has come such a long way from its original Pike Place Market storefront, founded in Seattle, Washington in 1971 (via its official website). Today, the chain boasts more than 34,000 locations worldwide, pouring coffee for millions of customers each day in countries spanning from Azerbaijan to Vietnam.
The United Kingdom is one of Starbucks' largest markets, with about 300 company-operated stores and 791 licensed stores (a business model similar to franchises) as of October of last year (via Statista). But the U.K. newspaper The Times reported over the weekend that the chain is looking into selling all of its U.K. operations.
According to the outlet, sky-high prices and a struggling U.K. economy are among the reasons that Starbucks is reportedly considering selling its 1,000-plus locations across the country. The paper writes that the coffee chain, which is the largest in the world, has asked its adviser Houlihan Lokey to assess buyer interest in its U.K. operations, which employ 4,000 people.
Difficult times for Starbucks, in the UK and the US
A CNN Business article analyzing The Times' reporting stated that in May, inflation in the U.K. soared to 9.1%, a 40-year high as well as the highest rate among the leading G7 economies. That rate is projected to climb above 11% later in 2022, a factor which has created a cost of living crisis for many U.K. residents. Disposable income in the country is way down, making it ever more likely that those looking to pinch pennies will reduce expenditures on nonessential items like a sweet cup of coffee — and even when they do spring for one, it might not be at a Starbucks. As noted by The Times, the chain faces many U.K. rivals, including Pret A Manger, Tim Hortons, and Costa, further compounding difficulties for lagging U.K. stores.
Starbucks told CNN that it is not currently engaged in a "formal sales process". Regardless, times have been turbulent for Starbucks as of late, with a major push for unionization among U.S. locations making news last summer and fall (via The Wall Street Journal) and prompting harsh criticism from its reputedly anti-union interim CEO. One of the company's most public faces in attempting to curb unionization, North American executive vice president Rossann Williams, exited last month (via Nation's Restaurant News), and in April, the company was sued by the National Labor Relations Board for allegedly retaliating against three workers who had helped to organize a union (via NPR).