Starbucks Union Calls for Boycott in Latest Test of Company Turnaround

Dow Jones
4 hours ago

Starbucks' unionized baristas on Tuesday called on customers to boycott the coffee chain, adding pressure to CEO Brian Niccol's efforts to revive the brand.

Starbucks Workers United, which represents more than 12,000 baristas, launched a "No Contract, No Coffee" campaign urging customers to stop buying Starbucks until the two sides reach a contract agreement.

The campaign comes as Starbucks is attempting a broader turnaround under Niccol, who launched the "Back to Starbucks" strategy focused on improving the customer experience, simplifying operations, and restoring the company's premium coffeehouse identity.

Starbucks did not immediately respond to a request for comment.

The company had been dealing with slowing traffic, weaker consumer demand, and pressure over its labor relations. But the turnaround plan is showing success.

In its latest fiscal third quarter, Starbucks reported U.S. comparable sales growth of 7.9%, marking the fourth consecutive quarter of comparable sales growth. Adjusted earnings rose 70% year over year to 85 cents a share, beating Wall Street expectations.

Shares of Starbucks have so far shown limited reaction to the latest boycott campaign. The stock fell 1.4% in Tuesday trading, but recently reached near its 52-week highs, suggesting investors remain more focused on the company's operational recovery than the labor dispute.

Starbucks Workers United represents just a fraction of the company's U.S. retail workforce, limiting the union's direct ability to disrupt operations across Starbucks' entire store network.

Still, the campaign could complicate Niccol's goal to rebuild employee morale and pose a reputational risk to Starbucks' turnaround. For investors, the key question is whether the boycott can affect customer behavior at a meaningful scale.

Starbucks has faced previous consumer boycotts, but the company's large store base, strong loyalty program, and daily purchasing habits make sustained traffic disruption difficult.

Unless the boycott expands beyond union supporters and begins affecting customer traffic or comparable-store sales, investors are unlikely to view it as a major threat to Starbucks' recovery plan.

 

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