Good news for Starbucks which was founded in 1971: all of its plans that have been put in place this year to stimulate growth are working out.
In order to that the company has made some of the following moves: opening new restaurant, developing new products, improving its technology use, and expanding its rewards program. And these strategies have been paying off with a 6% growth in sales for their new cafes which have been open for a least a year worldwide at the start of the third quarter for 2019 and its net sales growth of 8.1% is at an all tie high at $6.8 million.
Because of this success, Starbucks has improved its financial perspective for the 2019.
In order to achieve a scaled growth, Starbucks CEO Kevin Johnson made the implementation of those strategies a priority for the company.
The strategy of aggressively opening more stores worldwide, up to a total 442 of them so far this year, with about a third of them in China has really worked. Worldwide, Starbucks has a total of 30,600 cafes, opening its 30,000th cafe in 2019.
Another strategy that has helped increase its growth is making its rewards program a lot more attractive. This strategy has helped to increase its active member participation by 14 percent to reach a 17.2 million total.
The further tactic of partnering with Nestle Co. to produce new products has also been a success. The two partners developed and launched Starbucks new line of coffee creamers including Nespresso pods. The addition of new menu items in its cafes has also benefited sales increases.
Starbucks’ two largest markets are in the US and China and the new strategies for growth have really had its benefits in both countries. There has been a 7% increase in US sales for stores that have been open for a year, especially during the afternoon hours of the day which is the first time to happen in three years and in China there has been a 6 percent increase in sales.
Johnson said in a statement on Thursday, July 25, 2019. that in the US and China, his Starbucks stores performed exceptionally well using the new tactics.
Overall, the company is concentrating its efforts as well on improving customer experiences at its coffee cafes and is also expanding delivery service. However its delivery service hasn’t really begun to result in yields that are making much of an impact for now on its earnings.
Starbucks announced it is partnering with Uber Eats to expand its delivery service in the US.