Starbucks has had a disastrous start to the year – with tens of millions of customers heading instead to rivals or staying at home.
Tim Horton’s, McDonald’s and Dunkin Donuts have all taken market share from Starbucks across hot and cold drinks, and food.
The company this week reported a fall in sales for the first time in nearly three years, which was at the height of the pandemic. It was only in November it reported record takings.
Multiple factors are to blame – including high prices, customers cutting spending and bad weather – but slow service was highighted by the Starbucks CEO.
Starbucks’ growth has come on the back of complicated and customisable drinks like Frappuccinos in the summer or pumpkin spice lattes in the fall – but each can take baristas several minutes to make.
Starbucks – which has about 17,000 stores in North America – also warned investors on Tusday it would continue to see slow sales in the spring and summer.
A raft of factors have been blamed for the unexpected slowdown in sales have been highlighted since – by stock analysts, CNBC’s Jim Cramer and the company itself.
These also include boycotts of the brand linked Israel and competition from rivals.
On slow service, the company said it has seen millions of examples of customers ordering items but then abandoning their drinks since they took took long.
“We have customers coming to our stores today, or on mobile order pay, who don’t fulill their transaction because of wait times,” CEO Laxman Narasimhan said in an interview with CNBC’s Cramer.
“Our team in the US has done a phenomenal job in improving speed of service but we see more opportunities in doing that.”
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