Starbucks franchise operators across the Middle East and Southeast Asia are losing significant business amid boycotts linked to the Israel-Hamas war, and at least one has started laying off employees.
Alshaya Group, a Kuwait-based franchise operator that owns the rights to operate Starbucks in the Middle East, confirmed on Tuesday that it planned to cut 2,000 jobs across the region “as a result of the continually challenging trading conditions over the last six months.”
Since the Israel-Hamas war began, Starbucks has been forced to deflect perceptions that the company has supported and even funded the Israeli government and the Israeli military. It issued a lengthy statement in October describing the claims as false, but that has not cooled the calls for boycotts in numerous regions.
Alshaya Group, which operates over 1,900 Starbucks shops in the Middle East and North Africa that employ 19,000 workers, said in a statement that it would provide affected employees and their families with “the support they need.”
The cuts added to drama playing out in the United States, where Starbucks management and a union of Starbucks workers sued each other after the union expressed solidarity with Palestinians.
Boycotts have also been hurting sales at Starbucks franchises in Malaysia, a majority Muslim country. Berjaya Food Berhad, a Malaysia-based investment company that develops and operates restaurant and cafe chains across Southeast Asia, reported last month a 38 percent slump in quarterly sales as consumers turned away from its 400 Starbucks stores. The company’s stock has fallen over 20 percent since early October.
