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Starbucks Corporation (SBUX) has launched its revamped Green Apron Service across all U.S. company-operated stores in August 2023, aiming to improve customer connection and transaction growth following several underwhelming quarters. The initiative includes increased labor hours, expanded staffing, and earlier store openings during peak demand, resulting in improved customer experience scores and record low employee turnover.
As of September, over 80% of U.S. company-operated stores are achieving café service times of four minutes or less, largely due to the new Smart Queue sequencing algorithm. This led to positive U.S. sales comparable results driven by transactions, marking the first increase in several months. Starbucks management indicated that sustained improvements will hinge on consistent customer experiences as the company aims for long-term profit recovery through enhanced operational discipline.
In contrast, competitors like Dutch Bros Inc. (BROS) and Restaurant Brands International (QSR), the parent of Tim Hortons, are focusing on efficiency and value-driven service upgrades. As of now, Starbucks has seen a 0.8% increase in shares over the past six months, versus a 6.7% decline in the industry, while it trades at a forward price-to-sales ratio of 2.53, below the industry average of 3.5.
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