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Key Takeaways
- New Starbucks CEO Brian Niccol on Wednesday detailed his plan to revive the coffee chain.
- A central theme: He wants Starbucks wants to hand customers their coffee within four minutes of them ordering, believing speedy handoffs will help bring back customers.
- The coffee giants’ shares were little changed early Thursday following the company’s latest quarterly financial results.
Starbucks Corporation (SBUX) CEO Brian Niccol has brewed a plan for a brighter future for the coffee giant. Part of it is as basic as it gets: get customers their coffee quickly.
Niccol, former CEO of Chipotle Mexican Grill (CMG), led his first earnings call Wednesday since assuming the helm at Starbucks in September, detailing a “Back to Starbucks” campaign designed to lure back customers as comparable store sales fell for a third consecutive quarter.
Niccol said he wanted the company to give in-store customers their drinks within four minutes and to always get mobile-order customers their drinks on time. “The moment our barista hands a cup of coffee directly to the customer is our brand moment of truth,” Niccol said during the call, a transcript of which was provided by Visible Alpha.
Among other plans Niccol discussed Wednesday:
- He wants the company to improve staffing levels at key times. Relatedly, Niccol mentioned a plan to fill most retail leadership roles with internal hires.
- To make it easier “for customers to enjoy brewed coffee their way,” Niccol said Starbucks would bring back coffee condiment bars by early next year. That, he said, can also help with speed.
- He wants to simplify the menu. “We will still offer customers great choice but we’ll be focused on fewer, better offerings consistently crafted,” Niccol said.
- He wants to speed up installation of the “Siren” equipment and technology, which increases efficiency, Niccol said. The Siren system includes machines addressing employee tasks like blending and accessing milk and ice.
- And he wants to make changes to the company’s mobile ordering and payment system, which he said has helped drive orders but can make them “difficult to sequence and quickly deliver to our customers.”
“Our problems are fixable. Most of what we need to do is in our control,” NIccol said.
Starbucks late Wednesday said net revenue dropped 3% to $9.1 billion for the final quarter of the year, missing analysts’ expectations of $9.2 billion.
The stock was little changed in morning trading, leaving it up just slightly for the year so far.