Starbucks announced that it has 130 local stores in Russia, accounting for less than 1% of its annual income. After exiting the Russian market, it will let its employees in the country leave in the next few months and pay the salary of 2000 Russian employees for six months to help them transition to other companies.
As mentioned in a recent article on Wall Street, in response to Western sanctions against Russia, from Pepsi to Apple A large number of Western companies have withdrawn their business in Russia. McDonald's, a fast-food chain giant that has operated in Russia for 30 years, also officially announced its full withdrawal last week. Today, the name of coffee giant Starbucks is added to the list.
Picture from Wikimedia
On Monday, May 23 local time, Starbucks announced its official withdrawal from the Russian market, closing 130 stores and ending 15 years of cultivation in Russia.
According to a source quoted by the Russian media "SOTA vision", Starbucks announced that it has 130 franchised stores in Russia, accounting for less than 1% of its annual revenue. After exiting the Russian market, it will let its employees in the country leave in the next few months and pay the salary of 2000 Russian employees for six months to help them transition to other companies.
Consumers and investors continued to put pressure on Western companies such as Starbucks to cut off relations with Russia in response to supporting sanctions, but Starbucks said it would take time to lift the deal. Since March 8, Starbucks has suspended all business activities with Russia, including the transportation of all Starbucks products and the temporary closure of cafes.
In its latest quarterly results released in early May, Starbucks did not disclose the financial impact of the suspension of business activities. Kevin, the former CEO of Russia, has promised to donate the royalties to humanitarian undertakings. However, at present, the large catering chain enterprises in the United States are experiencing a headwind moment. Starbucks has fallen by about 36% since the beginning of the year. Although Starbucks welcomed the news that Howard Schultz, the legendary CEO and the father of Starbucks, returned to the head of Starbucks in early April, from the second quarter earnings data, Starbucks' profits are under pressure under inflation.
It is reported that Starbucks' decision to liquidate its Russian business is different from the withdrawal of some other foreign companies, including McDonald's and Renault. The latter two companies announced to sell their business to local partners last week. McDonald's previously announced that it would sell all its restaurants in Russia to local buyers.
After Coca Cola withdrew from the Russian market, Russian beverage producer ochakovo announced the launch of "coolcola", "fancy" and "street" to replace Coca Cola, Fanta and Sprite produced by Coca Cola company; When McDonald's withdrew, Russia's state-run Tass News Agency reported that Russia would reopen its former McDonald's restaurant under a different name next month. Maybe soon, there will be a substitute for Starbucks in the Russian market.
Starbucks U.S. stocks fell in early trading, and then rose 0.71% as of the issuance, with a cumulative decline of 36.66% year to date.
