Starbucks’ Plan a Guide for the Retail Sector?

Starbucks has a plan. Kevin Johnson, the Seattle-based company’s CEO, sent a letter last week to his workers explaining what measures the company will take to resume activities once the COVID-19 transmission curve flattens out in the countries where the company is active. The plan, broken down into three main points, could also become the guide the retail sector is looking for as it gets ready to return to business. According to Johnson, Starbucks’ plans are already being implemented in China, the first country to successfully contain the spread of the virus.

Self-service, contactless pickup and delivery and take-away orders are to be examined. These are the three pillars on which Starbucks will build its future in the post COVID-19 world. However, reopening plans will differ depending on the context of each country and region where Starbucks operates. “Our leaders are looking at four factors for reopening: the state of the public health crisis at the local level, suggestions of health and government officials in each country, the sense of community and the operational readiness of each store,” Johnson said in his letter in a report published by Business Insider. “We are preparing for the next phase as we adapt in the US,” he added.

At the moment, Starbucks is focusing on training its employees following the Chinese model. Each of them will have to wear gloves and masks for an indeterminate period of time. In addition, they are required to wash their hands every 30 minutes and disinfect high-traffic areas every eight minutes. As for customers, the body temperature of each one of them will be taken before entering an establishment in order to avoid contagion inside stores.

Starbucks’ plans could become the definitive guide that the retail sector has been looking for. As Chris Walton writes on Business Insider, the company was already one of the most advanced in the global retail sector before the crisis in terms of digitalization. Electronic payment, mobile applications and the opening of exclusive stores for collection were already part of the landscape in many of the markets where Starbucks operates. In fact, the company was among the first in the world to offer the option of recharging money through its app, a modality that, according to Business Insider, moved US$1.6 billion in the company’s stores in 2019. According to the same publication, in 2017 Starbucks achieved 30 percent of all purchases through some form of electronic payment. In other words, Starbucks was already committed to digitalization long before COVID-19 was even a remote possibility.

In 2018, consulting firm Bain & Company published a report stating that80 percent of Chinese buyers use some form of electronic payment system during their purchasing process. WeChat Pay and AliPay top the list, ahead of cash payment. In the US, however, the most widely used payment model is credit cards, followed by cash and debit cards. It seems, then, that China is leading the way in future shopping and Starbucks is one of its top students.