The American Starbucks Group’s stock is still struggling to erase the losses it incurred since last November 16 until last Friday’s session, amid a combination of influences, including the widespread popular boycott against the backdrop of Israel’s war on Gaza, employee strikes, and weak demand for promotional campaigns.
Continuous decline
The famous group’s shares closed yesterday, Friday, at $96.75, down 1.1% on a daily basis, making it the 16th session in which the company lost, compared to 4 sessions in green in which the American café chain caught its breath, according to data monitored by Al Jazeera Net.
On a monthly basis, the International Coffee Company’s stock has lost 9.7% since the session of last November 16, when it recorded $107.21 before entering a harsh downward journey and settling near $96.8.
This decline equates to a loss of more than $12 billion in the company’s market capitalization, which fell from $123.2 billion a month ago to $111.2 billion at the close of yesterday’s session, Friday.
Mustafa Fahmy, CEO of Strategies and Emerging Markets at Fortress Investment Company, said that Starbucks – which is facing a widespread boycott campaign – was unable to change consumer perception of its direction despite the promotional offers because the consumer now views it as a partner in supporting the occupation.
He added in an interview with Al Jazeera Net that Starbucks will face many challenges in the future, and he expected that its financial results for the fourth quarter would be very bad, and that it would be reflected in the total annual results of the famous American coffee company.
Starbucks faces the challenge of maintaining its brand reputation in light of these influences.
Conflict with workers
After a tweet from the Café Company Workers Union expressing their solidarity with the Palestinians, Starbucks filed a lawsuit against their union in October, prompting them to go on strike especially with backlogged wage claims.
This led to the expansion of boycott campaigns against the company to the United States and other regions of the world after it began in the Arab and Islamic world, against the backdrop of its expression of broad solidarity with Israel with the beginning of the war on Gaza.
The chain has more than 35,000 branches around the world in 86 countries, including more than 9,000 branches in the United States, and nearly 1,900 cafes in 11 countries in the Middle East and North Africa, through which more than 19,000 employees work.
It appears that the American company is living under the impact of accumulated problems with labor unions, as the US Labor Agency stated that it is seeking to force the company to reopen 23 stores that are believed to have closed last year to discourage a nationwide union campaign, in the latest case to accuse the café chain of illegal work methods.
Reuters quoted a complaint by a regional director at the US National Labor Relations Board (NLRB), last Wednesday, that 8 American stores actually stood in solidarity with the unions when the branches were closed.
Workers at more than 360 US Starbucks branches have voted to join unions since 2021, and the company faces more than 100 labor complaints at the US National Labor Relations Board.
For its part, Starbucks denied any wrongdoing and said it respects workers’ rights to join unions.
Starbucks added in a statement last Thursday that it conducts annual reviews of its stores and routinely makes changes for a variety of legitimate reasons.
Israel has been waging a devastating war on the Gaza Strip for the 71st day against the backdrop of Operation Al-Aqsa Flood, which was carried out by the Palestinian resistance in the Strip at dawn on Saturday, October 7th.
The toll of Palestinian martyrs since the beginning of this war has risen to 18,787 martyrs and 50,897 wounded, most of whom are women and children.
