Ex-CEO Howard Schultz says Starbucks needs to revamp its stores after big earnings miss

Former


Starbucks
CEO
Howard
Schultz
weighed
in
Sunday
on
the
coffee
chain’s
dismal
latest
quarterly
report,
saying
he
believes
the
company
will
recover
if
it
improves
its
U.S.
stores.

Schultz,
who
no
longer
has
a
formal
role
within
Starbucks,
wrote
that
the
company
needs
to
improve
its
mobile
order
and
pay
experience
and
overhaul
how
it
creates
new
drinks
to
focus
on
premium
items
that
set
it
apart.

“The
stores
require
a maniacal focus
on
the
customer
experience,
through
the
eyes
of
a
merchant.
The
answer
does
not
lie
in
data,
but
in
the
stores,”
Schultz
wrote
in
a
letter
on
Sunday
evening
posted
to

LinkedIn.

In
a
statement,
the
company
said
it
always
appreciates
Schultz’s
perspective.

“The
challenges
and
opportunities
he
highlights
are
the
ones
we
are
focused
on.
And
like
Howard,
we
are
confident
in
Starbucks
long-term
success,”
Starbucks
said.

On
Tuesday,
Starbucks

slashed
its
full-year
forecast
after
a
surprise
decline
in
same-store
sales
led
the
company
to
miss
Wall
Street’s
estimates
for
quarterly
earnings
and
revenue.
Since
the
report,
the
company’s
shares
have
fallen
17%,
dragging
its
market
value
down
to
$82.8
billion.

Analysts,
caught
off
guard
by
the
chain’s
underperformance,
have
been
looking
for
an
explanation
for
why
Starbucks’
U.S.
traffic
fell
7%
in
the
quarter.
The
chain
could
still
be
dealing
with
the
repercussions
of
social
media
backlash
related
to
its
position
on
conflict
in
the
Middle
East,
Bank
of
America
Securities
analyst
Sara
Senatore
wrote
in
a
research
note
Monday.

Schultz,
who
turned
Starbucks
from
a
small
chain
into
a
coffee
giant,
stepped
down
from
his
latest
stint
as
chief
executive
a
little
over
a
year
ago.
He
handed
the
reins
over
to
Laxman
Narasimhan,
who
previously
was
CEO
of
Lysol
owner
Reckitt.
Schultz
also
stepped
down
from
the
Starbucks
board
last
year.

He
appeared
to
offer
advice
to
his
successor
as
he
tries
to
turn
the
chain’s
sales
around.

“Leaders
must
model
both
humility
and
confidence
as
they
work
to
restore
trust
and
increase
performance
across
the
organization,”
Schultz
wrote.

A
year
and
a
half
ago,
Schultz told
CNBC that
he
does
not
plan
to
come
back
as
Starbucks’
chief
executive
again.