Starbucks announced its decision to increase staff numbers by hiring more baristas while scaling back plans for automation in its stores. This major change in direction is unsurprising given the company’s continuing decreasing sales trends and an overall effort to improve customer experience. Brian Niccol, who was named chief executive in September 2024, is leading the charge.
In a major policy turnaround, Starbucks has done an about face. The fast food giant has re-implemented policies that allow customers to use its establishments without the requirement of buying food. This amendment goes into immediate effect. It turns back a policy implemented six years ago that banned patrons from hanging around and using bathrooms without buying something. The move is a continuation of the grocery eco-system’s attempt to demonstrate that everybody, no matter what, is welcome at their grocery store.
Starbucks hopes to roll out this model to about 3,000 locations this year, representing a re-refocusing on in-person customer service. Not only is this a smart, capital-friendly move, but the strategy directly addresses the company’s years-long same-store sales slump. In the last quarter before March, global sales fell by 1%. That’s the fifth straight quarter of decreasing sales for the coffee behemoth.
Mr. Niccol acknowledged the challenges faced by Starbucks, stating, “Over the last couple of years, we’ve actually been removing labour from the stores. I think with the hope that equipment could offset the removal of the labour. What we’re finding is… that wasn’t an accurate assumption with what played out.”
The plan to hire additional baristas seems to mark a turn away from years of focus on cutting costs through labor-saving measures and labor cuts. Starbucks was already deeply invested in this automation technology, convinced that it drove efficiency and cut costs. New marketing director Jeff Niccol says having more staff on the ground will enhance the level of customer interaction and service provided. He acknowledges that this step might mean increased operating expenses.
“We want to allow our iconic green apron to shine and create a sense of familiarity for our customers.” – Starbucks
As the company navigates these changes, Niccol is optimistic about future growth, stating he is “banking on some growth to come with the investment.” It’s clear that Starbucks is facing today’s challenges with an honest and open mindset. In doing so, they are shoring up a stronger base, setting themselves up for greater long-term success.