While Starbucks (SBUX) - Get Starbucks Corporation Report basks in the glory of creating an Instagram sensation in the unicorn frappuccino, leave it to one barista to remind everyone about the coffee king's biggest challenge.
"I need to rant just a little bit," Starbucks barista Braden Burson said in a video posted on Twitter (which has seen been deleted) before going off on a tirade against the new pink and blue swirled sweet treat. "I have never been so stressed out in my entire life, it has been insane. If you love us as baristas, don't order the drink it's so difficult to make -- people were coming in left and right, drive-thru or in the front -- we don't know what type of frappuccinos go where, we just hand them out."
In effect, Burson hints that the popularity of the drink may be causing even bigger congestion headaches for Starbucks.
"It used to be, they [customers] would look at the line at the point of sale, and if that line looked too long, they might decide not to do a transaction at that time and come back later. Now when customers walk into the store, we've alleviated the congestion at the point-of-sale line, and now we have congestion at the hand-off plane," explained Starbucks then president and COO Kevin Johnson on a conference call in late January. Johnson has since assumed the CEO role at Starbucks, while Howard Schultz has moved to executive chairman.
"So, they might look at the number of customers around the hand-off plane and the number of beverages on the hand-off plane, and that might create the signal to them that they are going to wait to do their transaction," Johnson continued, adding that congested lines was "the most significant contributing factor" to the company's so-so 3% fiscal first-quarter same-store sales increase.
Promised Schultz at the time, "We are now laser-focused on fixing this problem. But the nature of it, too much demand, is an operational challenge we have solved before, and I can assure you we will solve again."
Ultimately, Johnson must find a solution to jam-packed Starbucks stores that may actually be costing the company sales.
As both an entrepreneur and Starbucks customer, David Lewis, CEO and President of human resources outsourcing and consulting firm OperationsInc. and CEO and President of AllCountyJobs.com, says that "this is a big issue Kevin needs to solve."
"The primary real estate in their stores dedicated to upsell is adjacent to the line for those walking in to order vs. those picking up only," Lewis says.
Lewis criticized Starbucks' layout of its stores, in which the majority of mobile pay customers do not have to pass the food items on display, comprised of snacks and boxed lunches, near the registers to pick up their pre-ordered coffees.
"Does Starbucks know how much historically gets purchased off those marketing displays - items the consumer is not coming into the store to buy when they arrive?" Lewis explains. "These items are not selling the same way and at the same place, I surmise, when the customer bypasses all of that and heads to the pickup counter."
All in all, Lewis believes Johnson needs to transform Starbucks from being a "place where someone is in and out without any interaction with the displays and other marketing."
Jim Cramer and the AAP team hold a position in Starbucks for their Action Alerts PLUS Charitable Trust Portfolio. Want to be alerted before Cramer buys or sells SBUX? Learn more now.
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Editor's Pick: Originally published April 21.