Starbucks to open 500 new stores in the Middle East amid easing boycotts
MIDDLE EAST – Starbucks has announced plans to expand its presence in the Middle East, with the addition of 500 new stores over the next five years.
The expansion is expected to create 5,000 new jobs in the region, CEO Brian Niccol told Bloomberg.
The global coffee chain currently operates over 1,300 stores in the Middle East through a licensing agreement with Kuwaiti conglomerate Alshaya Group.
The decision to expand comes as the company observes a decline in customer boycotts, which had previously impacted sales and foot traffic in the region.
In January 2025, Alshaya Group announced that it had suspended its plans to sell its stake in Starbucks’ Middle East and North Africa (MENA) franchise business, citing a reduction in boycotts.
Starbucks’ expansion strategy is not limited to the Middle East. China, one of its key markets, is also set to see growth despite economic challenges and competition from lower-cost rivals. CEO Niccol revealed that the company plans to add several thousand more stores in China.
However, Starbucks is also exploring strategic options for its China business, including a potential stake sale, according to Bloomberg News. Niccol made his first visit to China in January 2025 since assuming leadership in September 2024.
Since taking over, Niccol has focused on restructuring the North American business, which accounts for 75 percent of Starbucks’ total revenue.
His approach includes simplifying corporate structures, reducing management layers, and clarifying responsibilities to improve efficiency.
Starbucks has faced declining global sales, with first-quarter fiscal year 2025 results showing a 4 percent drop in comparable store sales. This was partially offset by a 3 percent increase in average ticket size.
In North America, comparable store sales also declined by 4 percent, with an 8 percent drop in transactions, mitigated by a 4 percent increase in ticket size.
Similarly, international markets experienced a 4 percent decline in sales, driven by a 2 percent decrease in both transactions and average ticket value.
In response, Starbucks is making significant operational changes. The company announced plans to streamline its menu by cutting 30 percent of its offerings by the end of fiscal year 2025.
Additionally, it will test a “capacity-based time slot model” for mobile orders, allowing customers to schedule their pickups.
Customer-focused initiatives, such as eliminating non-dairy milk surcharges and adding personalized messages on cups and bags, have helped increase store traffic, according to Niccol.
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