Mideast Starbucks franchisee is firing staff after being targeted in Israel-Hamas war boycott

Starbucks sign hangs outside a casino along Main Street Wednesday, Sept. 20, 2023, in Deadwood, S.D. (AP Photo/David Zalubowski)

DUBAI, United Arab Emirates — The Middle East franchisee of Starbucks said Tuesday it has begun firing staff at its coffee shops across the region after the brand found itself targeted by activists during the ongoing Israel-Hamas war in the Gaza Strip.

The Kuwait-based Alshaya Group, a private family firm holding franchise rights for a variety of Western companies including The Cheesecake Factory, H&M and Shake Shack, issued a statement acknowledging the firings at its Middle Eastern and North African locations.

"As a result of the continually challenging trading conditions over the last six months, we have taken the sad and very difficult decision to reduce the number of colleagues in our Starbucks MENA stores," the statement read.

Alshaya declined to answer questions about how many employees it was firing. Reuters, which first reported the layoffs, put the number at over 2,000 employees. Many of its employees in the Gulf Arab states are foreign workers hailing from Asian nations.

Alshaya runs about 1,900 Starbucks branches in Bahrain, Egypt, Jordan, Kuwait, Lebanon, Morocco, Oman, Qatar, Saudi Arabia, Turkey and United Arab Emirates. It had employed over 19,000 staff, according to the Seattle-based company.

Since the beginning of the war on Oct. 7, Starbucks has found itself alongside other Western brands targeted by pro-Palestinian activists over the war. The company prominently has been trying to counter what it describes as "ongoing false and misleading information being shared about Starbucks" being spread online.

"We have no political agenda," Starbucks said. "We do not use our profits to fund any government or military operations anywhere --- and never have."

In October, Starbucks sued Workers United, which has organized workers in at least 370 U.S. Starbucks stores. over a pro-Palestinian message posted on a union social media account.

Starbucks said it was trying to get the union to stop using its name and likeness as the post also drew protests from pro-Israel demonstrators. Boycotters also felt the company wasn't adequately supporting Palestinians in the Gaza Strip.

Starbucks revenue rose 8% to a record US$9.43 billion for the October-December period. But that was lower than the $9.6 billion analysts had forecast, likely in part due to activist boycotts.

Starbucks isn't the only brand targeted by activists in the war. Others have called for a boycott of McDonald's after a local franchisee in Israel announced in October it was providing free meals to Israeli soldiers.