Starbucks’ new CEO wants to turn Starbucks into a coffee house again

New York
CNN
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Starbucks has been in decline, with sales shrinking as it transformed from a traditional coffee shop into a place where people place orders on their phones and grab a drink from the counter. The new CEO has a plan to fix all that. And it starts with comfortable seating.

Brian Niccol, who is in his second day as Starbucks CEO, said in a letter to employees and customers that he wants to return Starbucks to its roots as a “community coffeehouse” with comfortable seating, design and a clear distinction between “to-go” and “for-here” service.

“There is a shared sense that we have drifted from our core,” he said Tuesday. “We are committed to elevating the shopping experience — ensuring our spaces reflect the sights, smells and sounds that define Starbucks.”

Niccol is considered the restaurant industry’s Mr. Fix-It, having turned around Chipotle and Taco Bell. He becomes Starbucks’ fourth CEO in two years, taking over amid a business downturn and pressure from employees and investors.

Starbucks’ sales have declined for two straight quarters. Some customers have expressed frustration over high prices, slow pickup orders on the Starbucks app and mediocre food options. The company, historically seen as a progressive employer, has also seen a wave of unionization in stores, driven by frustration over working conditions, pay and benefits.

Starbucks is transitioning from a primarily brick-and-mortar business to an online-driven business. Orders via mobile apps and drive-thru represent more than 70% of Starbucks’ sales at the approximately 9,500 company-operated stores in the United States.

He said in the letter that he has visited stores and spoken with employees and customers in recent weeks. He acknowledged in his letter that in some stores, particularly in the United States, “they can feel transactional, menus can feel overwhelming, products are inconsistent, wait times are too long, or handoffs are too hectic.”

He said Starbucks will focus on “empowering” baristas, making sure they have “the tools and the time to make great drinks.” Some workers have said mobile orders can pile up and overwhelm stores, putting a strain on workers.

Niccol, who lives in Newport Beach, California, has come under fire for not moving permanently to Starbucks’ Seattle office and instead using a corporate jet to commute.

According to the company, Niccol will spend time in stores, at the Seattle headquarters and with Starbucks employees around the world.