Starbucks’ gathering-spot model threatened by new coronavirus
For millions of people, visiting Starbucks is a daily ritual. But these are extraordinary times for one of the world’s most popular brands.
As the coronavirus sickened tens of thousands of people in China, the company closed more than 2,000 stores. When it arrived in the United States, the first serious outbreak was in Washington state, the coffee chain’s home. And last Friday, Starbucks became one of the first major American companies to have an employee who tested positive for coronavirus infection.
The last few weeks have been “very challenging times for all of us,” said Rossann Williams, the executive who oversees the company’s 200,000 workers in the United States. “We’re all learning as we go.”
Starbucks has long marketed itself as a social gathering spot — a “third place” between work and home, a symbol of normalcy for millions of people who buy coffee every day. Its bustling cafes are designed to build community and promote interaction between customers and baristas.
In recent days, however, that philosophy has come up against the threat of a rapidly spreading pandemic that has made people anxious about gathering in public places and sent shock waves through the global economy.
Now cafes are starting to empty out, as public health authorities urge people to work from home and avoid crowds. For service workers like the baristas at Starbucks, the threat of infection is especially severe.
To reassure the public, Starbucks has prohibited customers from using their own cups and established an intensive cleaning regimen, requiring employees to wash their hands and disinfect “high touch” surfaces every half hour. Even stricter protocols may lie ahead if the situation worsens, Williams said, such as mandatory gloves and face masks for employees or the removal of chairs and tables. She said stores in the United States could be temporarily closed in extreme cases.
The outbreak is already hurting Starbucks’ bottom line. While more than 90% of its stores in China have reopened, the company told investors last week that it expected sales in China this quarter to fall by about 50%, or as much as $430 million, from a year ago. The company said it was too early to say how the virus would affect its business outside China. Starbucks’ stock price has fallen more than 25% over the last month.
The virus’ toll on the company’s workers could also be significant.
“They’re the ones who are more likely to be exposed, because they’re out in the public, and also more likely to pass it on again,” said Elise Gould, a senior economist at the Economic Policy Institute. They are also less likely to have health insurance or paid sick leave. “It exposes the economic inequality that already exists,” Gould said.
On March 5, Starbucks temporarily closed a store near the Seattle Art Museum after an employee tested positive for the virus. The news reached senior leaders at 9 p.m. By 9 a.m. the next morning, the store had been thoroughly sanitized; it reopened Monday. All the employees who had worked closely with the person who tested positive were told to stay home for two weeks, with pay.
In its marketing, Starbucks has long highlighted its efforts to promote the well-being of employees, whom the company calls “partners.”
Even while its stores in China were closed, Starbucks continued to pay the majority of its salaried workers, a group that includes many baristas, according to a recent securities filing.
And on Wednesday, Starbucks told its workers in the United States that it would provide up to two weeks of paid leave to any employee who was infected with the virus or had extended contact with a co-worker or household member who tested positive. (Under its previously established policy, Starbucks allowed employees to accrue an hour of sick time for every 30 hours worked: A barista working 23 hours per week would accumulate about five sick days over a year.)
Still, in interviews, Starbucks employees expressed concern that the enhanced safety measures were at odds with on-theground realities. While few questioned the wisdom of the new protocols, some said the policies were putting more pressure on staff who already felt overworked.
A Seattle-area Starbucks employee who requested anonymity to speak frankly about the company said it’s unrealistic for employees to perform the full cleaning process every 30 minutes when cafes are busy.
Williams, meanwhile, is confident Starbucks will remain a gathering place — despite the growing anxiety about the pandemic.
“My gut tells me that when we get through this, people are going to want to go back to normalcy,” she said. “I do not believe that anything will ever negatively impact the sacredness of the third place in Starbucks stores.
“It’s never changed in 50 years, and I don’t think it’s going to change in the next 50 years.”