Starbucks saw its sales fall in the first quarter of its financial year, but less so than expected. Its strategy to get back on track seems to be yielding its first small successes.
Back to basics
Starbucks still reported a 4 % drop in comparable sales to 9.4 billion dollars (9 billion euros) in the first quarter, but that was still better than feared. Similarly, its per-share profit of 0.69 dollars was slightly better than the expected 0.68 dollars.
CEO Brian Niccol, who previously successfully transformed tex-mex chain Chipotle, wants to return Starbucks to basics. Among his first interventions are a simplified menu and the reintroduction of reusable ceramic cups, with the goal to reduce waiting times to less than four minutes per order.
100 millions earned
Starbucks has also decided not to implement any further price increases in 2025, despite the sharp rise in coffee prices. Less popular is the decision to allow only paying customers to use the seats and toilets in the coffee bars. “Although we are only one quarter into our turnaround, we are taking quick action within the ‘Back to Starbucks’ efforts and are seeing a positive response”, the CEO said.
The CEO himself draws particular attention because of his generous remuneration: Niccol received 96 million dollars (more than 90 million euros) in his first four months at the company, on top of a five million dollar bonus after just one month in office. Earlier, he was also criticised for continuing to live in Southern California and travelling by company jet to the Seattle headquarters.
