Starbucks, the global coffee chain originating from the United States, entered the Russian market in 2007. Over the next 15 years, Starbucks grew to operate around 130 locations across Russia. However, in March 2022, Starbucks announced it would suspend all business operations in Russia in response to the country’s invasion of Ukraine. This leaves many wondering – how many Starbucks locations actually closed down in Russia?
The Growth of Starbucks in Russia
Starbucks opened its first store in Russia in 2007 in Moscow’s Metropolis Mall. By 2010, Starbucks had grown to 36 locations across Moscow and St. Petersburg. In 2011, Starbucks entered into a partnership with a local restaurant operator, Kofe Houz, to help continue expanding its presence. By the end of that year, there were 56 Starbucks locations in Russia.
Expansion continued steadily through the 2010s. By 2014, there were around 100 Starbucks stores in operation across Russia. In particular, Starbucks focused growth on the major cities of Moscow and St. Petersburg, with around 60-70 locations in each city. Other cities with a Starbucks presence included Yekaterinburg, Kazan, and Rostov-on-Don.
By the end of 2021, there were approximately 130 Starbucks locations total across Russia. Moscow maintained the highest concentration of stores with around 80 locations, followed by 40-50 stores in St. Petersburg. Other cities had between 1-3 locations each.
Key Milestones in Starbucks Russia Expansion
- 1st store opens in Moscow in 2007
- 36 total locations by 2010
- Partnership with Kofe Houz in 2011
- Over 100 locations by 2014
- Approximately 130 locations by end of 2021
Suspending Operations in Russia
In early March 2022, Starbucks announced it would be suspending all business operations in Russia in response to the country’s invasion of Ukraine.
At the time of the announcement, Starbucks had around 130 locations across Russia employing nearly 2,000 people. All stores were company-owned and operated, with no franchises or licensing deals in Russia.
In a public statement, Starbucks CEO Kevin Johnson condemned the “unprovoked, unjust and horrific attacks on Ukraine.” He stated that Starbucks would continue paying its employees in Russia for six months while closing stores. Starbucks had operated in Russia for 15 years since entering the market in 2007.
Timeline of Starbucks Exiting Russia
- March 8, 2022 – Starbucks announces suspension of operations in Russia
- Nearly 130 locations closed across Russia
- Nearly 2,000 employees impacted
- Company commits to pay employees for 6 months during closure
As part of the closure process, Starbucks stated it would no longer accept payments from Russian credit cards or mobile apps. Remaining inventory was donated to local charities. By the end of March 2022, Starbucks had terminated its license agreement with its Russian operator and closed all stores.
Impact on the Russian Coffee Market
The closure of Starbucks locations across Russia had a noticeable impact on the country’s coffee shop market. Russia had been one of Starbucks’ fastest growing markets before the closure. According to market research firm Statista, Russia was Starbucks’ 13th largest market in 2021 based on number of stores.
Some key impacts on Russia’s specialty coffee market include:
- Lost a major specialty coffee chain. Starbucks helped introduce quality specialty coffee and espresso beverages to the Russian consumer.
- Reduced competition. Starbucks helped drive innovation and higher standards among other coffee chains in Russia.
- Job losses. Approximately 2,000 Starbucks employees lost jobs, though Starbucks paid them for 6 months.
- Lost meeting and working space. Starbucks locations served as informal gathering spaces, especially in Moscow and St. Petersburg.
Independent coffee shops may benefit from reduced competition. Domestic chains like Kofemolka and Coffee Like are likely to gain some market share. But overall, Starbucks’ closure significantly reduces access to specialty coffee across Russia.
Comparison to Other Global Brands Exiting Russia
Starbucks was one of many global brands across industries that announced suspension of operations and business relationships in Russia following the invasion of Ukraine:
- McDonald’s – Closed 850 locations in Russia, ending 32 years of operations in the market.
- Coca-Cola – Suspended business in Russia and paused investments.
- PepsiCo – Suspended soda sales and halted capital investments.
- Estée Lauder – Shut down stores and suspended commercial activity.
- IBM – Suspended all business in Russia, ending nearly 40 years of operations.
Like Starbucks, most major brands cited humanitarian concerns over the conflict in Ukraine as reasons for their withdrawal. This underscores how seriously the global business community is responding to Russia’s aggression.
Starbucks Locations Before and After Russia Exit
Prior to exiting Russia, Starbucks had around 130 total locations across the country. Here is a breakdown of Starbucks locations in Russia before March 2022:
| City | Estimated Stores |
|---|---|
| Moscow | 80 |
| St. Petersburg | 40-50 |
| Other cities | 1-3 each |
| Total | ~130 |
After Starbucks announced its exit, all 130 locations were closed by the end of March 2022. The company terminated its license agreement with its Russian operator and donated all remaining inventory. As of October 2022, Starbucks has no operational presence left in Russia.
Potential for Re-Entry into Russia
Starbucks has not announced any plans to re-enter the Russian market since its exit in March 2022. The company condemned Russia’s attack on Ukraine as “horrific” and acted swiftly to suspend operations.
Given the ongoing conflict and Western sanctions on Russia, it appears unlikely Starbucks will resume business in the country anytime soon. However, Starbucks has not made any definitive statements about leaving Russia permanently.
Some factors that may influence Starbucks’ decision on returning to Russia include:
- Resolution of the conflict in Ukraine. A return of peace could prompt brands to re-evaluate.
- Changes in the Russian political environment and leadership.
- Shifts in Russian public opinion and appetite for Western brands.
- Easing of global sanctions on Russian economy and trade.
Realistically, the factors that drove Starbucks’ exit are unlikely to change substantially in the short term. The company is likely prepared to cease Russian operations indefinitely until material improvements are seen in geopolitical conditions.
Quotes on Potential Russia Re-Entry
“We have no plans to reopen stores in Russia.” – Sara Kelly, Starbucks spokesperson, August 2022
“We continue to monitor the tragic events unfolding in Ukraine. Any decision to reopen stores in Russia will depend on that situation improving substantially.” – Rachel Ruggeri, Starbucks Chief Public Affairs Officer, May 2022
Conclusion
In conclusion, Starbucks operated around 130 locations across Russia when it announced suspension of business in March 2022. The exit closed all Starbucks stores in the country by the end of that month. This significantly reduced access to specialty coffee in Russia which had been one of Starbucks’ fastest growth markets.
It appears unlikely Starbucks will re-enter Russia anytime soon given the continuing conflict. But the company has not ruled out returning in the long term if political and economic conditions improve. The sanctions, public pressure, and operational challenges of the Russian market may keep Starbucks away for years to come. Nevertheless, the coffee giant’s suspension of business stands as one of the most substantial responses to Russia’s invasion among global consumer brands.