Starbucks has experienced a decline, transitioning from its traditional sit-down atmosphere to a faster-paced, mobile-order-centric model, which has led to decreased sales.
The new CEO has devised a plan to reverse these trends, starting with the reintroduction of comfortable seating.
On his second day as Starbucks’ CEO, Brian Niccol shared in a letter to employees and customers that his vision is to bring the company back to its roots as a “community coffeehouse.”
His plan includes reintroducing comfortable seating, thoughtful design, and creating a clear distinction between “to-go” and “for-here” service.
“There’s a shared sense that we have drifted from our core,” he said on Tuesday. “We’re committed to elevating the in-store experience — ensuring our spaces reflect the sights, smells, and sounds that define Starbucks.”
Niccol, known as the restaurant industry’s “Mr. Fix-It” for successfully turning around Chipotle and Taco Bell, is stepping in as Starbucks’ fourth CEO in just two years.
He takes on the role during a challenging time, with the company facing declining business and increasing pressure from both employees and investors.
Starbucks has reported a downturn in sales over the past two quarters. Customers have voiced dissatisfaction with high prices, slow processing of app-based orders, and uninspired food options.
The company, often regarded as a progressive employer, has also seen a surge in unionization efforts across its stores, driven by employee grievances over working conditions, pay, and benefits.
Starbucks is shifting its focus from a traditional retail model to one dominated by online transactions. Mobile orders and drive-thrus now account for over 70% of the company’s revenue from its roughly 9,500 company-operated stores in the U.S.
Niccol mentioned that he has spent the past few weeks visiting various locations and engaging with employees and customers.
He acknowledged in his letter that in some stores, particularly in the U.S., the service can feel impersonal, menus may seem overwhelming, products inconsistent, wait times lengthy, and service exchanges chaotic.
Starbucks plans to focus on empowering its baristas by giving them the tools and time they need to craft great beverages. Some employees have noted that mobile orders can overwhelm stores and overburden staff.
Living in Newport Beach, California, Niccol has faced criticism for not relocating to Starbucks’ Seattle headquarters and instead commuting via a corporate jet.
The company has indicated that Niccol will split his time between store visits, the Seattle headquarters, and engaging with Starbucks employees globally.
