Starbucks is seeking to withdraw from the UK, according to reports. The price hikes and economic decline may be the reason behind the alleged decision.
Reports from The Times suggest that the coffeehouse giant is meeting with advisers to identify if it could – or should – put its business on sale in the United Kingdom.
In reply to CNN Business, Starbucks showed an email it dispatched to its UK staff during the weekend repudiating that the giant is taking part in a “formal sale process” and pushing its decision to stay in the area.
The UK economy has been struggling lately, resulting in businesses having problems operating and residents scrambling to make ends meet. This means that the news may be possible.
UK inflation hiked to 9.1% in May – an all-time high in 40 years and the highest rate in the leading G7 economies. And they are far from a light in the tunnel: Inflation is estimated to rise over 11% this year.
The living cost crisis in the UK is getting worse by the day. As food prices continue to skyrocket, people’s disposable incomes have been dropping at an alarming rate; it looks like 1964 might be a closer comparison than ever before.
Odds are defoliated for the whole UK economy, said a report on financial stability issued by the Bank of England this month. The bank also stated that the prospects for the nation’s economy had “deteriorated materially.”
The UK economy is expected to suffer from zero growth by 2023, according to a recent report by the Paris-based Organization for Economic Cooperation and Development.
Businesses that are still in the process of recovering from the pandemic and facing a risky market are not a good idea, especially when it comes to picking up business again.
Starbucks was stagnant when customers stopped coming, but now that workers are starting their way back into offices, this has changed and helped them increase revenue again.
During a May call with analysts, Starbucks’ UK location’s sales recovered considerably in the quarter concluded on April 3, according to the group president of international and channel development, Michael Conway.
“Traffic continues to come into Central London metro areas, and we are increasing drive-throughs in that market at a significant rate,” he stated.
Starbucks has grown to be one of the most popular coffee chains in Britain, with around 300 company-ran locations and 800 stores that are licensed by October 2021. The giant started its UK operations when it opened up shop in 1998.
Starbucks Still Has Many Outlets in Different Country, So No Worries
As of November 2021, Starbucks owns 33,833 locations in 80 nations – 15,444 were in the United States. Out of the coffeehouse giant’s US-based locations, more than 8,900 are company-ran – the remainder of which are licensed.
Unions exist in numerous Starbucks stores, including Seattle, Buffalo, Rochester, Ithaca, Kansas City, and Manhattan.
The giant is the groundbreaker for a new wave of coffee culture. First, Starbucks offered more variety in its drinks and offerings.
It serves hot and cold beverages, whole-bean coffee, micro-ground instant coffee, caffe latte, espresso, juices, full and loose-leaf teas, Frappuccino drinks, snacks, and pastries.
Starbucks’ hype is attributed to influencers who unintentionally advertise its drinks and snacks because of their taste.