Following Russian President Vladimir Putin's invasion of Ukraine, countless international businesses have exited their positions in the country, including oil companies, tech companies, and fast food. Starbucks
The 130 licensee-run locations, representing 1% of Starbucks' annual revenue, temporarily stopped operations in early March, and the company halted all shipments of Starbucks products into the country. Starbucks now says it will be permanently closing its Russia locations. To help the roughly 2,000 Russia-based employees "transition to new opportunities outside of Starbucks", the company will be providing six-months pay.
"We condemn the unprovoked, unjust and horrific attacks on Ukraine by Russia, and our hearts go out to all those affected," former-CEO Kevin Johnson wrote to employees in March. "The invasion and humanitarian impact of this war are devastating and create a ripple effect that is felt throughout the world."
Prior to the announcement of the complete withdrawal, Johnson said that all royalties from Russia-based Starbucks would be donated to Ukrainian relief efforts. Johnson has since been replaced by former Starbucks CEO Howard Schultz as the company attempts to respond to unionization efforts across the United States.
Starbucks isn't alone in making its withdrawal more official as the Ukraine conflict continues. McDonald's also recently ended its 30-year presence in Russia, marking a definitive end to the hopeful theory that two countries that both have a McDonald's location won't go to war.
The theory held that countries which are too economically interconnected wouldn't risk conflict with each other, but it has since been broadly debunked, first following the Russian invasion of Crimea. If the theory held, Russia would not have risked invading Ukraine. However, rather than avoiding conflict, Russia has increasingly withdrawn from the global economic and political systems, pressured by international sanctions and corporate exits.
While the process of exiting licensing agreements is complex, the decision to exit Russia was considerably cheaper for Starbucks than for other corporations. McDonald's
Unlike Starbucks, McDonald's operated most of its 850 Russia-locations itself. Those locations are set to be sold to a Siberian franchisee who will run them under a new brand.
