The Strategic Organizing Center and Starbucks Workers United released a new study that says that 90% of Starbucks Corp. (NASDAQ: SBUX | SBUX Price Prediction) stores are understaffed and customers face long wait times. Starbucks Workers United and Starbucks management have not always gotten along. BerlinRosen, the PR firm that released the study, has a mixed reputation.
The survey is an indictment of new CEO Brian Niccol and his “Back to Starbucks” plan, a set of programs to get faltering same-store sales back on track. Strategic Organizing Center Research Director Joan Moriarty remarked on the study’s release, “The results of our survey demonstrate how Brian Niccol’s plan for Starbucks isn’t coming close to getting the company back on track for its workers and customers.”
The study’s results were based on four sections. First, the Back to Starbucks program has not yielded any results. Second, there has been understaffing at the vast majority of locations, causing long customer wait times. Third, low staffing has put an “unrealistic” burden on frontline staff. Finally, worker schedules are described as “uneven and mismanaged.”
The survey’s value, according to its authors, is that it shows that CEO Niccol has done nothing to curb six quarters of falling sales. And his new plans will not work in the future. Changes to store operations and barista uniforms were part of the criticisms.
If the survey results are true, even directionally, they will cause a Wall Street backlash. Many investors hoped that “turnaround expert” Niccol had the credentials to fix the company’s declining reputation and a series of unsuccessful past strategies. Same-store sales fell again in Starbucks’s most recently released quarterly earnings report.
The credit investors gave Niccol did not last long. Starbucks stock is down 5% this year, compared to an advance of 11% in the S&P 500.
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