After experiencing three consecutive quarters of declining same-store sales, Starbucks’ new CEO, Brian Niccol, is implementing changes aimed at improving the company’s performance. One of these measures includes reducing the number of highly customized drink orders.
Both customers and baristas have long expressed concerns about the intricacies of highly customized drinks, which can slow down service efficiency. In line with Niccol’s objective of delivering every order within four minutes, Starbucks aims to simplify its customization options.
To facilitate this, Starbucks plans to introduce more straightforward guidelines for customizing orders on its mobile app. During the company’s fiscal fourth-quarter earnings call, Niccol acknowledged that the current mobile ordering system is cumbersome for customers and employees alike. He noted that the complexity of customizing orders often leads to inefficient execution and added challenges for baristas.
Niccol emphasized that these changes will enhance consistency and help prevent unexpected price increases associated with highly customized drinks. Additionally, Starbucks will reevaluate its food offerings, favoring quality over variety by removing certain items from its menu.
Starbucks aims to streamline its menu in accordance with its primary focus as a coffee company. By concentrating on fewer, superior products, the company expects to improve service speed, quality, and consistency.
In addition to menu adjustments, Starbucks plans to reintroduce condiment bars stocked with milk and sugar at its stores starting next year, a feature largely absent since the COVID-19 pandemic. This initiative is intended to expedite service, allowing for simple drip coffee to be served promptly by cashiers, enabling customers to customize their beverages at the condiment bar.
Niccol stated that the return of condiment bars is driven by customer demand and baristas’ requests to enhance service speed.
Having left Chipotle to lead Starbucks in September, Niccol accepted a $113 million compensation package along with remote-working arrangements as part of his efforts to revitalize the coffee chain. Despite these strategic initiatives, Starbucks’ stock saw a slight decline of less than 1% following its fiscal fourth-quarter earnings report, which did not meet analysts’ expectations. The company reported a 7% drop in global comparable same-store sales and a 6% decrease in sales in North America and the U.S., marking three consecutive quarters of sales declines.
Niccol’s strategic changes are part of his plan to restore Starbucks’ aura as a “third place” and create a welcoming coffee house atmosphere. This includes focusing on enhancing the in-store experience, such as using ceramic mugs for certain beverages and allowing baristas to use sharpies for custom touches on drink orders.
Niccol believes these simple changes can significantly reinforce Starbucks as a community-centric and special place for connection.
