Coffee giant Starbucks (NASDAQ:SBUX) is undertaking a major leadership reshuffle globally, in line with their focus on growth through expansion plans. The changes are expected to be effective beginning next month.
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The company is setting up a geographic leadership structure that will be supported by global functions. Its CEO, Laxman Narasimhan, noted that the effort is aimed at realigning Starbucks towards a clear geographical focus while investing in functional capabilities to drive global scale.
The changes include Michael Conway, who has been with Starbucks since 2013, stepping into the newly minted role of CEO, North America. Conway currently serves as the Group President, International and Channel Development. Sara Trilling will continue to serve as the Executive Vice President and President for North America. She will focus on growing Starbucks’ store portfolio and licensed store business in North America.
Global Expansion Plans
With aspirations to increase its global reach, Starbucks, currently operating over 38,000 stores worldwide, reveals expansion plans to increase its footprint to 55,000 stores. Approximately 75% of new store openings are planned for outside the U.S. Under this vision, the coffee giant is appointing Brady Brewer as the CEO for Starbucks International.
Furthermore, Belinda Wong as the Chairwoman and Co-CEO, and Molly Liu as Co-CEO will continue to lead Starbucks’ China team. Under their leadership Luckin Coffee (OTC:LKNCY) has made substantial strides in the region. The coffee chain’s aggressive expansion strategy saw the addition of 8,000 net new outlets in 2023 alone, culminating in a total of 16,200 locations by the year’s close.
While Starbucks is focusing on global growth, rising commodity prices could potentially impact the company (and the broader industry) this year. According to Bloomberg, Cocoa futures have nearly doubled over the past three months. In turn, Starbucks shares have slid by about 6.3% during this period.
What Is the Target Price for SBUX?
Overall, the Street has a Moderate Buy consensus rating on Starbucks. The average SBUX price target of $107.58 points to a nearly 18.2% potential upside in the stock.
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