Starbucks closing all stores May 29 for racial bias training
Starbucks (SBUX) says it will close all company stores nationwide on the afternoon of May 29 to conduct a racial bias training.
The announcement comes as the company recovers from a racially charged incident last week that has led to protests and calls for a boycott.
"The training will be provided to nearly 175,000 partners (employees) across the country, and will become part of the onboarding process for new partners," the company said. Some 8,200 company-owned stores in the U.S. will be closed. (Starbucks also has 5,700 licensed stores across the country.)
On Thursday, two black men were arrested in a Philadelphia Starbucks and partial video of the incident went viral. Police said they were told that the men asked to use the restroom but were denied because they hadn't bought anything. They later released the men, saying there was no basis for a criminal charge.
The incident led to allegations of racial bias and calls to boycott Starbucks on social media. Protesters on Monday shut down multiple Starbucks in Philadelphia. Separately, a black man said he was denied access to a Starbucks bathroom in Los Angeles even though a white man who hadn't bought anything was given the code.
Starbucks CEO Kevin Johnson has met with the two men and apologized, and the manager who called the police is no longer at the store, the company said.
How much will shutting down for a few hours cost Starbucks?
A U.S. Starbucks location averages $4,400 a day in sales, according to Nick Setyan, an analyst at Wedbush Morgan.
Afternoons are the slowest time for a Starbucks, accounting for 15 to 20 percent of its business, said Setyan. So each store would lose between $650 and $880. That's about $7 million across all 8,000 company-owned stores in the U.S.
"To put that in context," said Setyan, "we expect their total revenue in fiscal year 2018 to be $24.4 billion. So not much of a financial impact."