ASIA – Starbucks franchise operators across the Middle East and Southeast Asia are grappling with significant business losses as boycotts gain traction in the wake of the Israel-Hamas war.  

Kuwait-based Alshaya Group, responsible for operating Starbucks in the Middle East, recently announced plans to cut 2,000 jobs across the region due to challenging trading conditions. 

Alshaya Group manages approximately 1,900 Starbucks branches in Bahrain, Egypt, Jordan, Kuwait, Lebanon, Morocco, Oman, Qatar, Saudi Arabia, Turkey, and the United Arab Emirates, with over 19,000 staff employed, according to the Seattle-based company. 

Alshaya Group released a statement stating, “As a result of the continually challenging trading conditions over the last six months, we have taken the sad and very difficult decision to reduce the number of colleagues in our Starbucks MENA stores.” 

Starbucks, a global coffee giant, has been compelled to dismiss perceptions of supporting the Israeli government and military. The company actively counters what it labels as “ongoing false and misleading information being shared about Starbucks” online. 

The impact of the boycotts is not limited to the Middle East, as Starbucks franchises in Malaysia also report a 38 percent quarterly sales decline.  

Berjaya Food Berhad, the investment company overseeing 400 Starbucks stores in Malaysia, attributes the plunge to consumer repel. 

Vincent Tan, the founder of Berjaya Food Berhad, addressed the situation in an interview, urging Malaysians to reconsider the boycott. 

“I think all those who are boycotting Starbucks Malaysia should know that it is a Malaysia-owned company. We don’t even have one foreigner working in the head office. In the stores, 80 to 85 percent of employees are Muslims. This boycott doesn’t benefit anyone,” he said. 

Starbucks adjusted its annual sales forecast in January, globally impacted by the Israel-Hamas war.  

Laxman Narasimhan, the company’s chief executive, cited a “significant impact on traffic and sales in the region” due to protests and boycotts. The repercussions, he noted, extended to the United States, influenced by misperceptions about the company’s position. 

The demand for Starbucks to take a stance on the war echoes on social media and outside Starbucks stores.  

In response to the Hamas-led attack on Israel in October, Starbucks denied providing financial support.  

Despite these challenges, Starbucks reaffirms its commitment to growing its business in the Middle East, collaborating with Alshaya Group on regional development plans. 

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