Starbucks will partner with Grubhub to deliver coffees and other customized beverages in select U.S. markets starting this month. Coffee delivery from Starbucks is its latest attempt to widen its reach as inflation-hit customers are increasingly opting to eat at home.

Starbucks coffee delivery

Starbucks delivery has been available on DoorDash in the U.S. since last year. It also has tie-ups with Uber Eats and Postmates, the food delivery arms of Uber.

Starbucks said it witnessed double-digit growth in the U.S. delivery business this past quarter.

Delivery by Starbucks will be accessible through the Grubhub mobile app, available on iOS and Android devices, and Grubhub.com. Starbucks and Grubhub partnership is to ensure delivery is as quick as possible so customers can enjoy their Starbucks beverages and food promptly. Customers can track their orders through Grubhub from preparation to drop off.

To ensure quality and assist with delivery, Starbucks developed multiple packaging solutions, including two-cup to-go trays and improved shopper bags, that are used for delivery orders and enable delivery drivers to easily transport multiple beverages at a time.

Starbucks Grubhub partnership

The coffee chain Starbuck’s products will be home-delivered in Pennsylvania, Colorado and Illinois at first, and then expand across the country by August, it said on Thursday.

“Our new partnership with Grubhub will help fuel this growth by increasing availability of Starbucks products to Grubhub’s tens of millions of customers,” Meg Mathes, vice president of digital experiences at Starbucks, said in a statement.

Starbucks sales forecast

Starbucks in April had cut its annual sales forecast. The decline in sales forecast was after reporting a fall in same-store sales for the first time in nearly three years. This was as it struggled with weak demand in the U.S. and China. China and U.S. are Starbucsks two biggest markets.

The company said with the monthly membership program of Grubhub, customers would be able to buy its drinks for zero delivery charge, lower service fees and exclusive offers.

The delivery will be accessible through Grubhub’s mobile app and official website.

Grubhub delivery

A part of Just Eat Takeaway.com NV, Grubhub also has delivery partnerships with restaurant and fast-food chains such as McDonald’s and Wendy’s.

Grubhub has even tied up with grocery delivery platforms such as Gopuff and Buyk. Also with companies like Starship Technologies to bring robot delivery services to college campuses.

Last week, Amazon added Grubhub to its website and app. This will help its customers in the U.S. order directly from the food delivery platform.

Starbucks stock update

Starbucks stock closed at $81.47 +0.31 on Thursday.

The post Starbucks Partners with Grubhub to Deliver Coffee to Your Door appeared first on Industry Leaders Magazine.

In a LinkedIn post published over the weekend, Schultz said many people had reached out to him after Starbucks reported weaker-than-expected Q2 sales and earnings last week.

Starbucks low Q2 performance

Howard 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, Starbucks 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.

Starbucks financial results

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.

The Seattle coffee giant said revenue dropped 2% in the January-March period as store traffic slowed around the world. It was the first time since 2020 that the company saw a drop in quarterly revenue. Starbucks also lowered its sales and earnings guidance for its full fiscal year.

Analysts, caught off guard by the chain’s underperformance. 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.

Howard Schultz’s contribution to Starbucks

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.

Starbucks strategy

Howard Schultz is not impressed with the current offerings, like Starbucks new lineup of spicy drinks and said its strategy needs to be “elevated with coffee-forward innovation that inspires partners, and creates differentiation in the marketplace, reinforcing the company’s premium position.”

He appeared to offer advice to his successor as he tries to turn Starbucks sales around.

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

Drop in sales

Same-store sales in the United States fell 3%, a sharp reversal from the same quarter a year ago, when they grew 12%. In China, the chain’s second-largest market, sales fell a staggering 11%.

Narasimhan vowed to turn the business around by including an update to its app and mobile and payment offerings, improving service times and rolling out revamped menu items to lure customers back.

Starbucks stock report

Since the report, Starbucks stocks have fallen 17%, dragging its market value down to $82.8 billion. 

The post Ex-CEO Howard Schultz’s Recipe for Starbucks’ Resurgence after Missed Earnings appeared first on Industry Leaders Magazine.

As Schultz came back a third time to lead the global coffee chain, the director of the board also announced that the company will suspend its stock repurchasing program immediately. In a written statement, he mentioned, “this decision will allow us to invest more into our people and our stores — the only way to create long-term value for all stakeholders.”

Speaking of his vision for the company, he wrote, “Our vision is to once again reimagine a first-of-a-kind for-purpose company in which the value we create for each of us as partners, for each of us as customers, for our communities, for the planet, for shareholders — comes because our company is designed to share success with each of us and for the collective success of all our stakeholders.”

Starbucks ShareFall

Schultz’s return comes at a time when there has been rising discontent amongst the coffeechain’s workers across the US. There have been calls for unionizations and workers have asked for better work conditions and pay. He has been widely credited with growing Starbucks into a global coffee chain.

Late last year, in October, Starbucks informed its stakeholders that it will implement a $20 billion share repurchase and dividend program spread across three years, in order to return profits to investors.

However, shortly after Schultz’s announcement, Starbucks’ stock prices tumbled downward. Starbucks share prices were down almost four percent on Monday afternoon.

In a letter to employees, he asserted his commitment to the company and assured stakeholders that in the coming weeks he “will be traveling, along with our leaders, to connect with partners in our stores and manufacturing plants around the world to understand your thinking and ideas about how to build this next Starbucks.”

Analysts believe that the decision will lower earnings in fiscal 2023 by nearly two to three percent. Industry experts are of the opinion that by halting the buybacks Schultz is getting ready to invest more in the company he helped found, by fending off unions, and focusing more on employees and growth. In the letter, Schultz reiterated his commitment to the coffeechain and mentioned that he hoped everyone will work together “to create a positive impact in the world.”

Starbucks and Unionization

As workers call for unionization, most industry veterans believe that Schultz will work towards halting unionization.

Starbucks spokesman Reggie Borges, however, denied such claims and called attention to Schultz’s leadership style of prioritizing the company’s partners. He stated, “Historically, at any moment when he led the company, it’s always been partner-led. It should come as no surprise to anyone that on the first day of his role as CEO one of the first decisions he’s made is to choose to support his partners and invest in his partners.”

Baristas at over 150 US locations have petitioned the labor board for union elections. Senator Bernie Sanders of Vermont had even written to Schultz asking him to accept unionizing efforts. In his letter, he cited complaints received by the National Labor Relations Board, where workers complained of illegal surveillance and threats against union supporters.

Meanwhile, Starbucks has continually denied such claims and stated that it only took action against employees who violated store policies. In 2021, a store in Buffalo became the first one to unionize while hundred others await union votes.

During Schultz’s reign the company grew from 11 stores to over 28,000, with a presence in 77 markets. He was also instrumental in developing the rewards program for their customers. During his tenure, Starbucks stocks delivered a 21,000% return, since its IPO, to investors.

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