Starbucks Is Officially Shutting Down 130 Cafes In Russia After 15 Years Of Business
Topics: News, Russia, Ukraine, Starbucks, Food and Drink
Charisa Bossinakis
Featured Image Credit: Alamy. Bjoern Steinz/Alammy
Topics: News, Russia, Ukraine, Starbucks, Food and Drink
After 15 years of operating, Starbucks in Russia will be officially shutting down due to its decision to launch a war in Ukraine.
The American multinational chain of coffeehouses announced that they decided 'to exit and no longer have a brand presence in the market'.
Starbucks will permanently close its 130 stores across the country, which is responsible for less than 1 per cent of global revenue for the company.
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NPR reports the coffee franchise will continue paying nearly its 2,000 employees for almost six months as they begin to find new jobs.
In March, the mega coffee house had indefinitely ceased all operations shortly after the invasion commenced.
Former CEO Kevin Johnson wrote that the company condemned the attacks, saying: “We continue to watch the tragic events unfold and, today, we have decided to suspend all business activity in Russia, including shipment of all Starbucks products.”
In a separate statement released that month, Johnson also vowed to donate royalties from its Russian business to humanitarian causes dedicated to Ukrainian relief.
McDonald’s has also announced it will pull out of the Russian market after 32 years.
McDonald’s President and Chief Executive Officer Chris Kempczinski wrote in a statement earlier this month: "The humanitarian crisis caused by the war in Ukraine, and the precipitating unpredictable operating environment, have led McDonald's to conclude that continued ownership of the business in Russia is no longer tenable, nor is it consistent with McDonald's values."
Kempczinski also added that although the decision was ‘extremely difficult’, they must remain ‘steadfast’ in their values.
The fast-food chain will be selling its restaurants to Alexander Govor, a local licensee who operates 25 locations throughout Siberia, according to New York Post.
Govor agreed to operate the sites under a new brand, which has yet to be revealed.
The company said a priority was making sure that 62,000 local employees would continue to be paid while making sure they could get jobs with Govor.
McDonald’s has begun the process of ‘de-arching’ all the restaurants, which will see the removal of the McDonald’s name, logo, branding, and menu. However, the company will continue to retain its trademarks in Russia.
In March, the company temporarily ceased all operations in 850 stores, including its site in Pushkin Square in Moscow, the first site to open in the country.