As airports prepare for the busiest travel days of the year during the upcoming Thanksgiving weekend, Starbucks (SBUX) is exploring ways to reduce wait times for customers at its airport outlets. The long queues have not escaped the notice of the coffeehouse chain’s new CEO, Brian Niccol.
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Niccol stated on the company’s Q3 earnings call, “Even when I think about the airports and such, there’s a huge opportunity for us, I think, to simplify some of the execution there so that we can get people the great throughput that they want so they can get on their way.”
Since joining in September, Niccol has pledged to win back customers and reverse the coffee chain’s declining sales.
Will SBUX Be Able to Cut Wait Times at Airports?
Niccol aims to cut service times to just four minutes, reducing long lines and enhancing the customer experience. It is important to note that Starbucks’ airport coffee houses are operated by licensees, not by Starbucks directly.
In Fiscal year 2024, the company’s licensed stores contributed 12% of its $4.51 billion in revenues. When it comes to airports, Starbucks operates in 47 of the 50 busiest U.S. airports.
However, the effort to reduce wait times may face challenges. According to CNBC, Starbucks began rolling out mobile ordering at airport locations in 2022. Yet, this change has sometimes caused confusion at airport counters rather than alleviating the issue. Additionally, many travelers may not be familiar with Starbucks’ app, as they might not be regular customers.
By improving operations at its airport cafes, Starbucks hopes to boost sales and restore its brand reputation.
Is Starbucks a Buy or Sell?
Analysts remain cautiously optimistic about SBUX stock, with a Moderate Buy consensus rating based on 15 Buys, six Holds, and four Sells. Year-to-date, SBUX has increased by more than 6%, and the average SBUX price target of $102.32 implies a downside potential of 0.2% from current levels.
