It seems Starbucks (SBUX) is staying in Seattle as the company refocuses on its coffeehouse identity under its new CEO, Brian Niccol, who joined the company in September. Niccol told Yahoo Finance that he does not intend to move the coffeehouse chain’s headquarters from Seattle. Starbucks first opened its café at Seattle’s Pike Place Market in 1971.
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Niccol commented, “[Moving] right now is not on the list of things to do. What I’m focused on is how do we make sure we get back to Starbucks in the stores.” He explained that his priority lied in improving Starbucks’ support centers in Seattle, New York, and Chicago.
SBUX investors have been wondering if Niccol would uproot the company’s headquarters from Seattle, as he had executed a similar plan in his earlier stint as CEO at Chipotle Mexican Grill (CMG). As the CEO of CMG, Niccol had shifted the Mexican food chain’s headquarters from Denver to Irvine, California.
Niccol Plans to Focus on “Back to Starbucks” Plan
For now, Niccol intends to focus on his “Back to Starbucks” plan. This plan aims to simplify the menu, speed up service, establish stores as a community coffeehouse, and improve relations with store employees.
In addition, the new SBUX CEO’s top priorities include faster drink preparation, optimized staffing, better tools and equipment for employees, and enhancements to the mobile ordering system, all intended to boost customer satisfaction.
Furthermore, in a move to add customer value, Starbucks will eliminate the upcharge for alternative milks starting November 7 and keep prices steady over the next Fiscal year. Niccol believes these steps will help rebuild Starbucks’ reputation, win back customers, and drive steady growth.
Is SBUX a Buy, Sell, or Hold?
Analysts remain cautiously optimistic about SBUX stock, with a Moderate Buy consensus rating based on 15 Buys, seven Holds, and three Sells. Over the past year, SBUX has declined by 4.4%, and the average SBUX price target of $101.60 implies an upside potential of 4.7% from current levels.
