Starbucks is implementing measures aimed at reviving customer interest, with initiatives focused on providing faster service and evoking its traditional coffeehouse vibe through items like ceramic mugs and handwritten notes. Despite some recovery in sales, the company continues to contend with long-standing labor disputes, which may hinder its efforts.
On Thursday, a strike organized by unionized baristas is anticipated to impact locations across at least 25 cities in the US, as workers push for improved wages and better staffing conditions. This strike marks the third significant work stoppage since the formation of Starbucks Workers United four years ago. Union representatives argue that recent changes intended to enhance the business have increased their workload instead.
Starbucks has stated that the strike is not expected to significantly disrupt operations at the majority of its over 10,000 stores in the US. However, the timing coincides with Starbucks’ “Red Cup Day,” a major promotional event, which could attract negative attention during a critical sales period.
In recent years, Starbucks has grappled with boycotts, an influx of competitors, rising customer dissatisfaction over pricing, and internal leadership challenges. New CEO Brian Niccol, who previously achieved success with Chipotle and Taco Bell, initiated a “Back to Starbucks” strategy aimed at revitalizing customer appeal. Niccol has implemented various changes, such as limiting bathroom access to customers and reintroducing comfortable seating, alongside plans to invest over $500 million in enhancing staffing and training.
Despite a reported 1% global sales growth last month, US sales have remained stagnant. Tensions continue between Starbucks and its union, with negotiations on pay and work conditions stalling. Starbucks has suggested that union demands could disrupt customer experiences, while union leaders claim that the offers made by the company do not adequately address inflation or healthcare costs.
Unionized stores currently represent about 5% of Starbucks’ US locations, but organizers report an increase of 100 unionized stores in the last year. The ongoing labor disputes pose potential risks to both operational efficiency and the brand’s reputation, as indicated by its recent drop in Brand Finance’s annual ranking. To address this, more than 80 congressional Democrats have reached out to Niccol, urging the company to negotiate sincerely with its employees.
Source: https://www.bbc.com/news/articles/c5ype4j07xpo?at_medium=RSS&at_campaign=rss