FX.co ★ Starbucks New CEO Sets Priorities As It Drifts From Core

**Starbucks Corp.'s New CEO Brian Niccol Outlines Priorities for Initial Days, Focus on U.S. Business**

Starbucks Corporation’s newly appointed CEO, Brian Niccol, has set his sights on revitalizing the coffee giant's U.S. operations before turning his attention to international markets. In a candid open letter addressed to employees, customers, and stakeholders, Niccol emphasized the company's deviation from its foundational principles and laid out a comprehensive 100-day plan to reestablish Starbucks as a beloved community coffeehouse.

Recognizing a decline in the "Starbucks magic" across U.S. locations, Niccol highlighted four critical areas for improvement. These are: enhancing the barista experience, refining morning service, revitalizing the community coffeehouse ambiance, and strengthening the company's branding.

To achieve these objectives, Starbucks plans to invest in technology to enrich the experiences of both partners and customers, streamline its supply chain, and advance its app and mobile ordering platform.

As a long-time customer himself, Niccol remarked, "Many of our customers still experience this magic every day, but in some places — especially in the U.S. — we aren't always delivering. It can feel transactional; menus can appear overwhelming; the product may be inconsistent; the wait too long or the handoff too hectic. These moments are opportunities for us to do better."

When discussing international markets, Niccol stressed the importance of understanding growth potential in China and addressing misconceptions about the brand in regions such as the Middle East. Additionally, he sees significant growth opportunities in the Asia Pacific, Europe, and Latin America, where the Starbucks brand is already strong.

Niccol, who previously served as Chairman and CEO of Chipotle Mexican Grill, Inc., took the helm at Starbucks on September 9. He succeeded Laxman Narasimhan, who resigned in mid-August amidst challenging headwinds, including weak profits and declining sales.

In the most recent third quarter, Starbucks reported a 7.6 percent decline in earnings from the prior year, coupled with a 1 percent drop in revenues. While net revenues for the North America segment rose by 1 percent, this gain was negated by a 7 percent decrease in the International segment.

Moreover, global comparable-store sales fell by 3 percent, driven by a 5 percent drop in comparable transactions. In the U.S., comparable-store sales decreased by 2 percent, and the International segment saw a 7 percent decline, with China alone experiencing a 14 percent drop.

Upon Niccol's appointment, Starbucks highlighted his transformative impact at Chipotle. Since becoming Chipotle’s CEO in 2018, Niccol nearly doubled the revenue and increased profits almost sevenfold, resulting in an 800 percent surge in the company's stock price. These accomplishments were achieved while also improving wages for retail team members, expanding benefits, and strengthening the company culture.

Starbucks, which operates in 87 markets worldwide, boasts its own coffee farm, five roasting facilities, and Reserve Roasteries located in Milan, Shanghai, Tokyo, New York City, Chicago, and Seattle.