Starbucks makes shock U-turn after years of job cuts and plunging sales

Daily Mail​

a day ago

Starbucks has launched its biggest hiring spree in history — aimed at finally tackling the number one gripe from frustrated customers.
The recruitment blitz— adding as many as 85,000 workers across its 17,000 US locations — is a bold move aimed at slashing long wait times.
Customers have grown weary of waiting 20 minutes for a drink, with many walking away from the chain entirely.
Soaring prices and what critics call a 'soulless' in-store experience have only added to the exodus — helping drive a sharp drop in sales.
New CEO Brian Niccol, speaking to 14,000 store managers at a Las Vegas event on Wednesday, called it 'the biggest human capital investment in connection in the history of Starbucks.'
He said the goal isn't just to speed up service, but to ease pressure on overworked employees and bring back the warmth and personal touch that once made Starbucks a beloved 'third place' between home and work.
'Your rosters are going to expand with this,' Niccol told managers, who can begin hiring from August.
Five years ago, Starbucks stores averaged 23 employees. Cost-cutting has since trimmed that number down to 18 to 19 — four to five fewer workers per location.
Restoring pre-Covid staffing levels would mean hiring between 68,000 and 85,000 people across all US stores.
Even focusing solely on the 11,000 company-owned locations, the increase would still be a massive 44,000 to 55,000 hires.
Jodi Love, a portfolio manager at T Rowe Price, a Starbucks shareholder, estimated the labor investments would add more than $1bn in additional spending to fiscal 2026.
But the move is expected to resonate with baristas on the frontlines, many of whom have long complained of chronic understaffing that fuels delays and drains morale.
The new hires are also expected to support Starbucks' efforts to bring back a more personal touch — including a new policy asking baristas to handwrite notes on customers' cups.
Explaining the U-turn, Niccol told the Financial Times: 'We over-rotated on the idea of equipment and that replacing the humanity of service,' Niccol told the Financial Times.
'And I think service is our point of difference. Despite everybody saying they're more connected than ever, everything I read is people feel more lonely than ever.
'I think part of the problem is there aren't enough third places anymore.'
Former Chipotle boss Brian Niccol was hired to revive Starbuck's ailing fortunes
The new Starbucks boss has said he will simplify the chain's 'overly complex menu' in a bid to win back customers amid slumping sales
Customers have increasingly been turned off by long wait times and rising prices at the chain
Starbucks is scaling back the promotions and discounts offered through its mobile app
Starbucks held
Niccol was hired last year in an effort to turn around the struggling chain.
Former CEO Howard Shultz agreed with Niccol telling Wednesday's company event 'we're not a company based on technology.
'That enables us, we're a company based on people.'
The former Chipotle boss has embarked on a series of plans to return Starbucks to its original 'third place between home and work' concept.
Coffee drinkers have turned away from the chain in recent years, put off by high beverage prices, long wait times and impersonal experiences.
Niccol has set about axing complicated drinks from Starbucks menus, asking staff to put messages on customer's coffee cups and scaling back promotions.
The plan will help address the major customer pet peeve of long wait times before getting their hands on a coffee.
It will also likely be popular with front of house employees who have complained of chronic issues with understaffing, which compounds the backlogs.