Dive Brief:
- Starbucks announced Thursday Rachel Ruggeri will succeed Patrick Grismer as CFO and executive vice president upon Grismer's February 1 retirement.
- Ruggeri, currently senior vice president of finance for Starbucks Americas, will report to President and CEO Kevin Johnson. Grismer will remain with the company in an advisory role until May 2.
- Ruggeri begins her new role as Starbucks adjusts to pandemic-induced sales declines, plans for off-premise-focused stores and rolls out wage hikes.
Dive Insight:
Grismer has been CFO for just over two years. Prior to Starbucks, he held senior finance roles at The Walt Disney Company before becoming CFO of Yum! Brands International. Just prior to joining Starbucks, he spent two years as CFO of Hyatt Hotels.
Ruggeri joined the coffee chain as finance director in 2001, ascending to SVP of finance for the Americas in 2017. Between 2018 and 2020, she left Starbucks to serve as CFO of Seattle-based food production company Continental Mills, before returning to her post in June of last year.
Ruggeri inherited the CFO role in the midst of a tumultuous market environment, but Starbucks expects to recover from pandemic disruption soon and plans to open roughly 22,000 new locations within the next decade. The chain's current footprint spans about 33,000 locations.
But these growth plans follow a contraction of the company's U.S. store network. In June, Starbucks announced it would close 400 U.S. locations by mid-2021. The company said these stores will eventually be replaced by units in new locations with new formats.
Ruggeri will also come in as Starbucks begins making larger changes to employee pay. Johnson told The Wall Street Journal in December that the chain would raise pay for all U.S. Starbucks workers to at least $15 per hour over the next three years. Starbucks also raised wages at least 10% for many workers hired on or before Sept. 14 on Dec. 14, and increased starting wages 5%.
Though the company is bullish on its 2021 performance despite the pandemic's drag on the industry at large, same-store sales were down 9% in its most recent quarter. Still, this was a marked improvement from its Q3 performance, which saw same-store sales declines of 40%.
The company's focus on bolstering its off-premise channels could help grow sales as well. Starbucks said during its investor conference in December that 45% of its locations will eventually feature drive-thru lanes, a 10% increase from its current drive-thru mix, which could accelerate the maturation of its digital business.
