Starbucks plans to open 100 new stores across the UK this year while investing millions of pounds in upgrading existing cafes. It comes as the world’s largest coffee chain reported a big jump in sales in the UK for 2022, continuing its recovery from the pandemic. Last year the firm was reportedly looking to sell its British operations.
Starbucks, which launched in the UK in 1998, has over 1,000 outlets in the country. Its UK expansion comes despite inflation – the rate at which prices rise – being near a 40-year-high, pushing up the cost of ingredients for the firm and eating into its profits. The firm also plans to open 300 new stores in the rest of Europe, the Middle East, and Africa (EMEA). However, Duncan Moir, who lead’s firm’s EMEA business, said he remained “cautious” about economic outlook. “Like many other businesses”, he said Starbucks had faced challenges including shortages of HGV drivers, rising supplier costs and shipping delays. It is also struggling with higher energy bills and demands for higher wages from staff.
Hospitality companies across the UK have been putting up pay as they face a shortage of workers and the cost of living rises. Pret A Manger recently announced it will be giving its staff their third pay rise in 12 months. Starbucks said that since the pandemic, its customers’ habits had changed and as a result, the firm would seek to increase its number of drive-through branches, and invest in digital capabilities in its stores. It added that as many people continued to work from home, footfall at cafes in city centres and train stations had been slower to recover, with London being the exception.
Starbucks last year was reportedly considering selling its UK business as it faced rising competition from other chains. The firm, which denied it ever began a formal sales process, had also been hit hard by pandemic restrictions around the world. About 70% of its UK shops are run as franchises, with the remainder owned by the company, and Starbucks said the new stores will be a mixture of both.
