Dive Brief:
- Starbucks announced Thursday that Rachel Ruggeri will succeed Patrick Grismer as CFO and executive vice president of the coffee giant effective Feb. 1. Grismer will retire from his roles effective Feb. 1.
- Ruggeri, currently senior vice president of finance for Starbucks Americas, will report to President and CEO Kevin Johnson. Grismer will serve as an advisor to Johnson until May 2 to help with the transition.
- Ruggeri will step into her new role as Starbucks adjusts to pandemic-induced sales declines, plans for off-premise-focused stores and rolls out wage hikes.
Dive Insight:
Ruggeri, who joined the coffee chain company in 2001, will inherit the CFO role in the midst of a tumultuous market environment, but Starbucks expects to recover from pandemic disruption soon and plans to open roughly 22,000 new locations within the next decade. The chain's current footprint spans about 33,000 locations.
But these growth plans follow a contraction of the company's U.S. store network. In June, Starbucks announced it would close 400 U.S. locations by mid-2021. The company said these stores will eventually be replaced by units in new locations with new formats.
Ruggeri will also come in as Starbucks begins making larger changes to employee pay. Johnson told The Wall Street Journal in December that the chain would raise pay for all U.S. Starbucks workers to at least $15 per hour over the next three years. Starbucks also raised wages at least 10% for many workers hired on or before Sept. 14 on Dec. 14, and increased starting wages 5%.
Though the company is bullish on its 2021 performance despite the pandemic's drag on the industry at large, same-store sales were down 9% in its most recent quarter. Still, this was a marked improvement from its Q3 performance, which saw same-store sales declines of 40%.
The company's focus on bolstering its off-premise channels could help grow sales as well. Starbucks said during its investor conference in December that 45% of its locations will eventually feature drive-thru lanes, a 10% increase from its current drive-thru mix, which could accelerate the maturation of its digital business.
