"Brian Niccol has been Starbucks Corp. ( NASDAQ: SBUX) CEO for a year. He recently said the coffee store chain would soon be a "world-class customer service" company. He has come nowhere close to that, if his changes and Starbucks earnings are any measure. Niccol claims the company is well along this path, based on feedback from employees and customers. He didn't offer any solid proof."
"Over the past year, Starbucks stock is down 13%, while the S&P 500 is 18% higher. Niccol has tried several new tactics to bring customers back and make Starbucks a neighborhood place again. He has reduced the menu, which should help speed up service. Baristas now put notes on cups when they give them to customers. He is in the midst of remodeling some stores. He says he has increased staffing at stores to improve service. And Starbucks baristas have a new dress code."
"Niccol has also set a mandate that office workers be in their offices four days a week. He has fired 1,100 management people to make Starbucks "leaner and more focused." Niccol's efforts have not gotten revenue growth back on track or reversed a decline in comparable store sales. In the most recent quarter, revenue was up 3.8% to $9.5 billion. Earnings dropped 47.3% to $0.49 per share."
Brian Niccol has led Starbucks for a year and vowed to transform the chain into a world-class customer service company. Stock fell 13% over the past year while the S&P 500 rose 18%. Niccol implemented menu reductions, cup notes, store remodels, increased staffing, and a new dress code to speed service and rekindle neighborhood appeal. He mandated four days in-office for corporate staff and eliminated 1,100 managers to streamline operations. Recent quarter results showed revenue up 3.8% to $9.5 billion, earnings down 47.3% to $0.49 per share, and comparable store sales down 2% worldwide. Niccol targets 30,000 stores in China amid competition from Luckin Coffee.
Read at 24/7 Wall St.
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