Starbucks betting big on drive-throughs in coming years

Coffee chain plans to expand, but new locations will look a bit different

Starbucks plans to open 22,000 new stores over the next few years (iStock; Getty)
Starbucks plans to open 22,000 new stores over the next few years (iStock; Getty)

Even though, like other retailers, Starbucks suffered big losses due to the pandemic, the chain is still betting on customers’ need for caffeine.

During the company’s virtual Investor Day last week, the coffee conglomerate announced that it plans to open an additional 22,000 stores, bringing its total global footprint to 55,000 shops, by 2030, Bisnow reported. CFO Patrick Grismer maintained that the company would continue its global expansion, calling the pandemic as a “temporary disruption” to its business.

But the pandemic will change what those stores look like: The company plans to make drive-throughs a priority at new locations. Currently, only 35 percent of Starbucks stores have a drive-through option, but the plan is to grow that number to 45 percent by 2023.

Company executives also project Starbucks’ rate of expansion going forward to be on the lower end of normal. Store growth rate has previously been 3 to 4 percent in the US, and 6 to 7 percent outside the US. In fiscal year 2022, it will likely be closer to 3 percent and 6 percent, respectively.

Sign Up for the undefined Newsletter

Sales took a big hit in the fourth quarter of the company’s fiscal year, with U.S. sales declining 9 percent compared to the same time last year. International comp-store sales were down 10 percent.

Earlier this year, the company confirmed that it would shutter 400 stores across the country as it adjusted to consumers’ shifting needs because of the pandemic. In a typical year, approximately 100 stores close.

Despite all this, investors don’t seem to have lost faith in the chain. Starbucks started 2020 with company stock trading at $89.50 per share; it’s finishing the year at $103.32 per share.

[Bisnow] — Raji Pandya