At first, it sounds like the office supply run of a madman. What do 200,000 Sharpie markers have to do with corporate success? Nevertheless, that is what Brian Niccol, the new CEO of coffee giant Starbucks (SBUX), has in mind. And though it may not be quite as lunatic as coffee spiked with olive oil, investors are skeptical, and sent Starbucks shares down fractionally in Thursday afternoon’s trading.
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The 200,000 Sharpies, Niccol elaborated in a CNBC report, will be used to help bring Starbucks back to its roots, back to the old days of writing people’s names on cups. It is part of the larger initiative to make Starbucks feel more like a “community coffeehouse” again, a move that has been somewhat overmastered by bizarre coffee flavorings and high-speed drive-thru ordering.
But that will not be the only improvement; Niccol is planning a full-scale revamp, starting with something as simple as ceramic mugs and working all the way up to new “cozy” furniture. With these changes, Niccol hopes to revitalize Starbucks back into being a “third place,” a place that is not work or home but that people go to to socialize and relax.
More Changes Forthcoming
Changes beyond furniture and coffee mugs are coming to the chain as well. For instance, those who prefer non-dairy options in their Starbucks drinks used to have to pay an additional surcharge to accommodate that dietary preference. Starting November 7, though, that charge will be gone, and non-dairy creamers will run the same price as any dairy option.
Niccol also has a slew of more systematic changes in mind. Service times are expected to drop, which means people get their drinks faster. Starbucks is also planning to open fewer new locations in 2025, which should help pare back capital expenditure as well.
Is Starbucks Stock a Good Buy Right Now?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on SBUX stock based on 15 Buys, seven Holds, and three Sells assigned in the past three months, as indicated by the graphic below. After an 8.9% rally in its share price over the past year, the average SBUX price target of $101.60 per share implies 4.6% upside potential.
