A global economic slowdown, shipping disruptions and coffee price fluctuations are among the uncertainties sure to be front and center for the new chief executive officer— especially since Starbucks Corp. founder Howard Schultz, who’s twice returned from retirement to replace earlier successors who faltered, will remain on the board to keep an eye on the transition.
“The restaurant industry is facing challenges—labor, commodities, the consumer environment,” says Credit Suisse Group AG analyst Lauren Silberman. In Starbucks’s largest market, North America, there’s already evidence that many consumers are slowing their purchases, especially for things considered discretionary, like dining out. About 60% of shoppers have already cut expenditures because of higher prices, and more plan to scale back in the year ahead, according to a November report from the University of Michigan’s Surveys of Consumers.
Schultz has laid out an optimistic view for fiscal 2023, raising guidance for sales and new-store growth that have created lofty Wall Street expectations—which Narasimhan will be under pressure to achieve. While the coffee chain has largely lagged rivals on pushing through price hikes, analysts expect the company to price closer to inflation in 2023 to protect profits. “The expectations are going to be for margins to expand” this year, says Bloomberg Intelligence analyst Michael Halen. “But that’s going to be tough to do if sales start to slow.”
Diese Geschichte stammt aus der January 16, 2023-Ausgabe von Bloomberg Businessweek US.
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Diese Geschichte stammt aus der January 16, 2023-Ausgabe von Bloomberg Businessweek US.
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