Starbucks’ sales in recovery mode; to open more pick-up only stores in the future

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Starbucks’ sales in recovery mode; to open more pick-up only stores in the future

By Marianne Wilson - 05/21/2020

Starbucks sales are on the rise as the company continues to reopen its cafes.

In a letter on Thursday to employees, Starbucks CEO and president Kevin Johnson said that the company has regained about 60% to 65% of its prior year U.S. same-store sales during the last week. The increase came as Starbucks locations were reopening under modified operations and with reduced hours. To date, the company has reopened more than 85% of its cafes.  

“In China, we have seen progress as well and our comparable store sales have reached about 80% of prior year levels, reflecting gradual improvements over the past several weeks,” Johnson said in the letter. “Our recovery progresses each week, and we know that it will take time to fully recover and post positive comparable store sales growth. For example, we began reopening a large number of stores in the U.S. in the second week of May and we are tracking slightly above our forecasted recovery curve.”

Johnson said the company was “borrowing strongly” from lesson learned as it reopened in China, expanding options for mobile ordering and pick-up, and innovating store operations to serve customers responsibly. He also said the company expects to open more Starbucks Pickup stores, the first of which opened in Manhattan last November, along with more curbside pickup options as well as delivery.

“By blending traditional Starbucks stores in dense markets with these new Starbucks Pickup stores optimized for the mobile order occasion, we not only improve the customer experience for those who want to sit in our store and enjoy their beverage but also create a great experience for those customers who want a convenient way to pick up their beverage on-the-go,” Johnson said. 

During what Johnson called the “COVID-19 economy,” many Starbucks U.S. stores will maintain modified operations and reduced hours and will not require the same level of staffing.

“As customer traffic builds, we will see an increasing number of partner hours allocated to our stores,” he added. “Until that time, however, the number of hours many of our partners were used to pre-pandemic won’t be available.”

The company is extending its COVID-19 unpaid leave policy through the end of September as an option for employees who need the safety net of Starbucks benefits and wish to remain a Starbucks employee while also being able to access any emergency benefits for which they may be eligible.

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