When Brian Niccol steps in as CEO of Starbucks, he’ll be tasked with fixing the chain’s operational issues.
When Brian Niccol steps in as CEO of Starbucks, he'll be tasked with fixing the chain's operational issues.Chipotle, Niccol's current employer, hasn't faced the same issues because the company invested in its operations before its digital sales boom.cafes: a counter crowded with mobile orders, frustrated customers waiting for the drinks they ordered and overwhelmed baristas trying to keep up with it all.
Mobile orders account for roughly one-third of Starbucks' total sales, and tend to be more complicated. While add-ons like cold foam or syrups are more profitable for Starbucks, they tend to take up more of baristas' time, frustrating both them and customers."I agree with Howard Schultz," said Robert Byrne, senior director of consumer research for Technomic, a restaurant market research firm."This is not in the data — this is in the store. This is where the issue lies.
But Starbucks also didn't make significant adjustments to its operations to anticipate that shift in consumer behavior. "The problem you have in New York City, for example, is what is the wait time," said Nancy Tengler, CEO and chief investment officer of Laffer Tengler Investments, which owns shares of both Starbucks and Chipotle."And then the mobile orders taking precedence over the in-store orders. going to have to flip that somehow to get people to spend more time and more money in stores."
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