Starbucks leaves Russia due to war with Ukraine

It's the latest major U.S. company to exit the country

Starbucks leaves Russia due to war with Ukraine

The hits just keep on coming for Russia, as Starbucks has announced the coffee chain will stop doing business in the country permanently.

In March, in the wake of Russian President Vladimir Putin’s invasion of Ukraine, the Seattle-based company paused its operations and stopped shipments of its products to Russia. At the time, Starbucks' then-CEO Kevin Johnson said, “we condemn the horrific attacks on Ukraine by Russia and our hearts go out to all those affected.”

In April, Johnson retired after 13 years with the company. As a result, Howard Schultz, who served as CEO twice before and has been serving as chairman emeritus, has returned as interim CEO and rejoined the company’s Board of Directors.

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On Monday, Starbucks announced it “has made the decision to exit and no longer have a brand presence in the market,” according to a press release. Employees in the country, which number about 2,000, will get paid for six more months and Starbucks will also help them look for new jobs.

As of March, Starbucks had 130 Russian locations, all owned and operated by a partner. The coffee juggernaut entered the country in 2007.

The move follows a similar one by McDonald's. Last week, the fast-food giant also vowed to pull out of Russia, having already temporarily closed 850 outlets in March. The Chicago-based company claimed that the decision came down to the "humanitarian crisis" and "unpredictable operating environment" amid the ongoing conflict.

McDonalds added that one of their main priorities now was looking to ensure their 62,000 employees in Russia will continue to be paid and supported until any sale was completed.

“The humanitarian crisis caused by the war in Ukraine, and the precipitating unpredictable operating environment, have led McDonald’s to conclude that continued ownership of the business in Russia is no longer tenable, nor is it consistent with McDonald’s values,” the company said in a statement. “McDonald’s priorities include seeking to ensure the employees of McDonald’s Russia continue to be paid until the close of any transaction and that employees have future employment with any potential buyer.”

McDonald’s has operated in Russia for over 30 years, opening its first outlet in Moscow in 1990.

“We have a long history of establishing deep, local roots wherever the Arches shine,” added president Chris Kempczinski. “We’re exceptionally proud of the 62,000 employees who work in our restaurants, along with the hundreds of Russian suppliers who support our business, and our local franchisees.

“Their dedication and loyalty to McDonald’s make today’s announcement extremely difficult. However, we have a commitment to our global community and must remain steadfast in our values. And our commitment to our values means that we can no longer keep the Arches shining there.”

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