Starbucks doesn't want to be on every street in New York and Los Angeles anymore

"Starbucks spent years trying to become an inescapable storefront on the streets of New York, Los Angeles and other big cities in America. Now that's coming to an end. Its expansion once seemed limitless. It was even a joke. In 1998, an Onion headline read New Starbucks Opens In Rest Room Of Existing Starbucks. A few years later, comedian Lewis Black riffed that he'd gone to the end of the universe in Houston, where he saw one Starbucks directly across the street from another."

"But Starbucks is now struggling, and its strategy of saturating urban areas to draw coffee drinkers on their way to work in the morning has backfired amid competition, the rise of remote work and rising costs. So CEO Brian Niccol, hired last year from Chipotle to revive Starbucks, no longer wants its stores to be right next to each other. Starbucks is closing roughly 400 stores nationwide that are concentrated in large metro areas as part of its $1 billion restructuring plan."

"Starbucks closed 42 locations in New York, or 12% of its total in the city. It recently lost its top spot as the largest chain in Manhattan to Dunkin', according to Center for an Urban Future, a New York City think tank that tracks chain openings and closings. Starbucks also reportedly closed more than 20 locations in Los Angeles this year; 15 in Chicago; seven in San Francisco; six in Minneapolis; five in Baltimore; and dozens more in other cities."

Starbucks moved from aggressive urban saturation to strategic contraction as its dense storefront strategy faltered. Competition, the growth of remote work and rising operating costs reduced commuter traffic and profitability. CEO Brian Niccol, recruited from Chipotle, is shifting away from placing stores adjacent to one another and focusing on brand standards and performance. The company reviewed more than 18,000 U.S. and Canadian locations and is closing roughly 400 underperforming metropolitan stores under a $1 billion restructuring. The company plans new openings and remodels in 2026 with refreshed designs and elevated experiences in major metros.

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