If a strike by Starbucks’ (NASDAQ: SBUX) workers is supposed to get them better benefits and treatment, the store count affected by the union action is modest. About 300 of Starbucks’ 16,621 US locations have been hit. That is only 1.8% of stores.
The Starbucks worker strike began in Chicago, Los Angeles, and Seattle. Starbucks was founded in Seattle. According to some reports, several states were hit two days later. These included Colorado, Missouri, New Jersey, New York, Ohio, and Pennsylvania. The total number of employees who walked off the job may have been as high as 10,000.
Workers United, which represents Starbucks workers, said workers have been mistreated. And Starbucks was not negotiating in good faith. However, Starbucks management told CNN it has bargained with the union for nine “sessions” and 20 days since April. It is hard to tell which of these statements is accurate.
Starbucks’ revenue could be hurt, but probably not much. North American and US comparable store sales fell 6% in the most recent quarter. Revenue dropped 3% to $6.7 billion. Operating income dropped 22% to $1.3 billion. How much will a sharp sales drop in 300 stores over five days of strikes affect it?
There is a public relations problem. New Starbucks CEO Brian Niccol wants to return to a period of excellent customer service and strong relationships with the company’s workers. For customers, this includes faster delivery of drinks and food. It also includes returning Starbucks to a community where customers like to “mingle.” For workers, it means Starbucks will be the “best place to work” and a good one for “career opportunities.”
The strike undermines each of Niccol’s goals.
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