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    Starbucks Plans Pick-Up-Only Store in NYC

  • More locations could be coming in big cities.

    Starbucks
    "Think of it as a Starbucks pick-up,” Starbucks' CEO Kevin Johnson told Bloomberg.

    Starbucks launched the first Starbucks Now store in Beijing in July. With the on-the-go consumer in mind, the new design allows guests to order in advance through the mobile app and simply grab their orders without having to wait in line. Starbucks said the streamlined experience is convenient for customers and delivery drivers looking for an express option. 

    This innovative model is now heading to New York City, and is set to open this fall, Bloomberg reported

    “What we’re using Starbucks Now for, and what will be Starbucks pick-up stores in the U.S., is to blend them in where we have dense urban areas where we have a lot of Starbucks third-place cafes,” Starbucks' CEO Kevin Johnson told Bloomberg just ahead of the company's leadership conference in Chicago. “Think of it as a Starbucks pick-up.”

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    The store in Manhattan is still in development, but Johnson told Bloomberg he expects to roll out similar pick-up locations in other cities including Boston, Chicago, Seattle, San Francisco, and Los Angeles.

    Starting September 4, more than 12,000 Starbucks store managers and leaders gathered for Starbucks' largest employee conference. Everything from customer service to growth and partnership development were at the center of interactive leadership sessions. 

    The three-day event was “designed to help transform leaders and solidify the foundation of an enduring company,” the company said. During the event, attendees spent over 60,000 hours in six leadership development sessions.

    “At this transformative time for the company, we must continue to have the wisdom to honor our heritage and stay true to our mission and values, while at the same time have the courage to boldly reimagine the future of Starbucks,” Kevin Johnson said in a statement.

    One of the biggest announcements concerned the company’s employee mental health policy. Employees were “afraid to reach out to the employee assistance program, so they’re working to enhance the program, which provides short-term counseling services,” Yahoo Finance reported. After reviewing surveys and listening to employee concerns, Johnson said, it’s time for the company to change its policy. 

    "We believe this is a societal problem and we want to take steps within Starbucks for our partners to break the stigma of mental health, acknowledge that it exists, and do some creative things to provide services to those in need,” Johnson told Yahoo Finance.

    Conference attendees were able to participate in a discussion with a clinical psychologist to learn about emotional aid, how to develop self-awareness, and how to thrive in their job.

    At the closing general session, Rossann Williams, who leads Starbucks' U.S. retail business, announced the company was expanding mental health benefits to U.S. workers, one of the top requests it receives. “Today we are taking a stand,” she said. “We believe in breaking the stigma around mental health.”

    The company said "meaningful changes" would be rolled out over the next year.

    Some include:

    • An enhanced Employee Assistance Program co-created with employees and qualified mental health experts to connect more partners to quality care that meets their specific needs.
    • Training for store managers inspired by Mental Health First Aid in Q2.
    • Partnerships with organizations such as the Born This Way Foundation and Team Red White & Blue to help break the stigma around mental health.
    • An app solution for all U.S. and Canada employees to help promote mental wellness. Starbucks said it’s on pace to offer Headspace subscriptions by January. Headspace is a platform that teaches meditation.

    Starbucks also said it was working to empower store managers by investing in them “as they lead partners, elevate the customer experience, and ultimately grow engagement.”

    “Through strategic, long-term investments in labor hours, training, and streamlining tasks and processes critical to running a store, we will work to alleviate some of the pressure and stress that often limits our store managers to lead and grow. The goal: create more time and space so every store manager can lead their business to higher levels of excellence in the third-place experience and business performance,” Starbucks said.

    In July, Roz Brewer, the chain’s COO, said Starbucks recently installed a labor scheduling tool that’s aiding the effort.

    Over the last few quarters, Starbucks looked carefully at the tasks weighing down employees, and asked what it could automate to improve customer-facing service. The brand took out roughly 12 hours of work at the store level, Brewer said.

    Some examples: Starbucks went into some of its major markets that are high mobile order and pay areas and expanded the handoff plane. Now, when customers are crowding in the area where mobile order and pay is exchanged and the drinks are given to guests, Starbucks simply extended the physical space.

    Moving forward, Starbucks plans to introduce inventory excellence and routines, Brewer said, which will improve execution, as well as streamline food processes. An automated centralized planning and replenishment initiative is expected to arrive in the second quarter of next year.

    Feedback from employees in the past two years, Williams said, led to new laptops for store managers, improvements in Starbucks’ scheduling software with Teamworks, Clean Play, digital incident reporting, a way to print Playbuilder updates.

    From this event, she said Starbucks’ new commitments include:

    • Adding up to eight hours of labor to employees’ forecast: Starbucks store managers asked for more time so they can coach partners, run the business, and connect with customers. These incremental hours will be available for schedules written the week of October 14, with more information coming in the Holiday PPK, Williams said.
    • Reducing 17 hours of complexity: Starbucks identified additional tasks that it will start automating, reducing or eliminating in FY20, Williams said. The chain has some new updates starting January, including the new MyDaily app for in-store communications, a new shift swap feature in TeamWorks, and a new Pull-to-Thaw app that’s going to make in-store inventory management much more efficient.
    • An enhanced Employee Assistance Program co-created with employees and qualified mental health experts to connect more partners to quality care that meets their specific needs.
    • Training for store managers inspired by Mental Health First Aid in Q2.
    • Partnerships with organizations such as the Born This Way Foundation and Team Red White & Blue to help break the stigma around mental health.
    • An app solution for all U.S. and Canada employees to help promote mental wellness. Starbucks said it’s on pace to offer Headspace subscriptions by January. Headspace is a platform that teaches meditation.

    Here are some additional changes coming:

    • Safer transportation: Starbucks said it wants employees to feel like they can get to and from work safely. By the beginning of Q2, it will launch a rideshare option for baristas and shift supervisors opening and closing stores. It will start with 2,000 stores in select cities so the brand can learn and adjust.
    • Starbucks 411: By the end of the year, Starbucks will launch a single number called Starbucks 411. The two help desks employees call the most, Facilities and EHD, will be digitized by the end of 2020.
    • Fixing things when they break: Starting in October, Starbucks will end deferred maintenance. When something breaks, the chain is going to fix it, it says. And in Q2, employees will be able to track requests digitally.
    • Starbucks Coffee Academy: The comprehensive program, available at StarbucksCoffeeAcademy.com, is designed to help ignite or reignite partners’ coffee passion.
    Starbucks

    “This is the largest partner experience in our company history, and a signal of our commitment to store managers and field leaders who are well positioned to lead us forward,” Johnson said in a letter to Starbucks partners.  

    Schultz exits the race

    In December 2016, founder and former CEO Howard Schultz handed Johnson the reigns after 40 years. Schultz transitioned into the role of executive chairman to focus full-time on the company’s social impact initiatives as well as innovation and global development of Starbucks’ Reserve brand. He left the brand in July 2018. Schultz put his hat into the political ring and announced he was running for president as an independent candidate in January. He announced September 6 he was dropping out of the race.

    "I have concluded that an independent campaign for the White House is not how I can best serve our country at this time," Schultz wrote in a letter posted on his website on September 6. "Not enough people today are willing to consider backing an independent candidate because they fear doing so might lead to re-electing a uniquely dangerous incumbent president. There is considerable concern that four more years of a Trump administration pose a graver threat to our democracy than four more years of political dysfunction."

    The brand, which took a dip in 2018, bounced back and posted its best results in two years at the end of Q3 in 2019. U.S. same-store sales jumped 7 percent and global same-store sales lifted 6 percent.

    The boost comes after Johnson addressed three, company-defining changes: beverage innovation, an improved in-store experience, and digital relationships. Starbucks moved the needle by boldly rethinking its customer and how it handles day-to-day delivery and back-end execution.

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