Starbucks announced that Brian Niccol has been appointed chairman and chief executive officer. Niccol will start in his new role on September 9. He currently serves as chairman and CEO of Chipotle.
The Seattle Times looks at Niccol’s time at Chipotle, noting that he “grabbed the helm of the fast-Mexican-food chain and steered it into the digital age,” taking advantage of mobile ordering and building out a strong customer database.
Starbucks praised Niccol’s tenure at Chipotle, writing: “His focus on people and culture, brand, menu innovation, operational excellence and digital transformation have set new standards in the industry and driven significant growth and value creation. Revenue has nearly doubled, profits have increased nearly sevenfold, and the stock price has increased by nearly 800% during his leadership, all while increasing wages for retail team members, expanding benefits and strengthening the culture.”
The Wall Street Journal took an in-depth look at Starbucks’ current state, writing that “Behind the scenes, Niccol’s appointment was the culmination of months of internal angst over Starbucks’s direction and leadership.”
Previous CEO Laxman Narasimhan, who took the reins in March 2023, inherited lofty goals. The Journal reported that he “set out to simplify a sprawling supply chain and operations, seeing a direct link between inefficient drink-making and the long lines that frustrated patrons.” However, “Customer complaints about slow service times continued to mount, with often highly customized orders being placed through the chain’s increasingly popular mobile app.”
QSR Magazine noted that Starbucks’ “stateside transactions plunged 7% in Q2 as same-store sales declined 3%. It marked the worst performance outside of the pandemic or Great Recession and a sharp departure from post-Covid trends—traffic figures were healthy as recently as October. That red line continued in Q3, the three-month period that ended June 30, with Starbucks’ U.S. same-store sales falling 2%, comprised of a 6% traffic slide and 4% growth in average ticket (the same number as Q2).”
The coffee purveyor also has been struggling in China, falling behind Luckin Coffee in mid-2023, losing its spot as the country’s top coffee chain. “At an investor conference in November 2023, Narasimhan said the company was largely on track to hit its growth targets. He said he remained committed to running the company’s China business, versus the potential spinoff that some investors had said they wanted,” the Journal reported.
Read more about Narasimhan’s early days at Starbucks: “New Starbucks CEO Wants Efficiency and Optimization.”