New Starbucks CEO Brian Niccol outlines priorities to end coffee chain’s slump

New Starbucks CEO Brian Niccol will focus on improving the chain’s U.S. business in his first 100 days on the job before he moves to fix its issues abroad, according to an open letter published on Tuesday.

The coffee giant named Niccol as chief executive in August, in conjunction with the company’s ouster of then-CEO Laxman Narasimhan. The leadership shakeup followed several quarters of slumping sales for Starbucks as demand for its drinks declined, particularly in the U.S. and China.

Niccol’s official first day was Monday. He joined Starbucks from Chipotle Mexican Grill, where he spent six years as chief executive, turning it from a burrito chain in crisis into a consistent favorite of both diners and Wall Street. Now he’s tasked with executing a turnaround for Starbucks.

“… In some places — especially in the U.S. — we aren’t always delivering,” Niccol wrote in the open letter addressed to customers, employees and stakeholders. “It can feel transactional, menus can feel overwhelming, product is inconsistent, the wait too long or the handoff too hectic. These moments are opportunities for us to do better.”

Niccol outlined four areas for improvement: the barista experience, morning service, its cafes and the company’s branding.

“This is our plan for the U.S., and where I need to focus my time initially,” Niccol wrote in the letter.

To tackle those challenges, Starbucks will invest in tech to improve the barista and customer experience, make company’s supply chain more efficient and upgrade its app and mobile ordering.

But later, he’ll plan to address its international business, like China, its second-largest market. Starbucks’ business in China has struggled to bounce back from the pandemic, and increased competition has led the coffee chain to lean more on discounts and promotions to win back customers.

“In China, we need to understand the potential path to capture growth and capitalize on our strengths in this dynamic market,” Niccol said.

He also said the company will try to curb what he called “misconceptions” about its brand in the Middle East. Many U.S. brands, including Starbucks and McDonald’s, have faced boycotts tied to backlash against U.S. support for Israel’s offensive in Gaza.

This story is developing. Please check back for updates.