Should Starbucks make the $40 million investment?

Should Starbucks make the $40 million investment?

• $40 million investment in labor for its 4574 stores = $8,750 for each
store.
• The goal of this investment is to increase satisfaction let’s see how this
translates into number of customers that need to go from being
satisfied to being highly satisfied.
• Average daily customer count, per store is 570. Starbucks needs to
turn 50 of 570 or 9% of its customers from satisfied to highly satisfied
in order to break even.
• A first assumption is Speed of Service- Starbucks customers, fast
service ranks #6 in importance.
• A second assumption is that all stores are equal in size, number of
people they serve, location and prices and that all the stores need this
additional investment.  
Should Starbucks make the $40 million investment?

• New customers- Additional 32,000 customers per year for all stores.
• $0.05 additional- Each customer in each visit in order to break even.
• It is evident that only 10% of the Starbucks customers have asked for
a faster, more efficient service.
• Customer base and Identify areas where people are less satisfied.
• To establish an internal strategic marketing group that would
coordinate actions of the market research group, the category group
and the marketing group.
• As 77% of the company’s revenues came from beverages which were
handcrafted.