Starbucks hunts for another tech office, including abroad

[CHICAGO] Starbucks is not stopping at Nashville. The coffee chain, which recently announced a new Tennessee office, is hunting for yet another location for technology workers that could potentially include international cities.

The company is looking to reduce its tech costs further, after already cutting spending by US$100 million in the last 90 days, chief technology officer Anand Varadarajan told his division in an internal meeting on Wednesday (Apr 22), according to a recording reviewed by Bloomberg News.

Starbucks currently outsources many tech roles to third-party providers who are in areas with “lower cost per head” but charge a markup, Varadarajan said. Instead, Starbucks would like to bring jobs back in-house to have the same access to that type of talent, without a middleman. Starbucks is looking at US locations but also abroad, he said.

“We are going to be planning for more sites in the future,” said Varadarajan, who wants the share of in-house tech workers to rise to at least 80 per cent from about 45 per cent currently. “It would be kind of facetious and disingenuous for me to say we’re not looking at sites outside of the United States.”

Starbucks is in the midst of a broader turnaround after sales declines, which have started to moderate through efforts led by CEO Brian Niccol since late 2024. The company is looking at cutting about US$2 billion in costs while also hiring more store workers and renovating its cafes.

For its Nashville expansion, the company has offered relocation packages to employees in its sourcing team but has faced resistance from some workers reluctant to move, Bloomberg reported. About 270 technology positions, or about 20 per cent of the current tech labour force, are moving to Nashville, Varadarajan said in the meeting.

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Starbucks said on Tuesday that its Nashville office will cost about US$100 million and house about 2,000 workers. The company is looking to create brand-new jobs and also relocate workers from Seattle. Starbucks said that it’s looking for access to talent and proximity to suppliers, and the location also offers lower taxes and labour costs.

Varadarajan said that Starbucks is “still looking at” the specifics of any possible sites. BLOOMBERG