Starbucks will be removing the extra charge for non-dairy milks, including soy milk, oat milk, almond milk, and coconut milk starting Nov. 7, the company announced in conjunction with the release of its fourth quarter earnings.
Vegan activists have protested the company’s extra charge for non-dairy milks for years. At the last company shareholders meeting, Starbucks shareholders declined to create a report to reconsider non-dairy-based milk pricing.
Removing this upcharge of 70-90 cents on average has been one of the top requested changes from customers, and according to Starbucks, substituting for non-dairy milk is the second-most-common substitution, behind only adding a shot of espresso.
“Core to the Starbucks Experience is the ability to customize your beverage to make it yours,” CEO Brian Niccol said in a statement. “By removing the extra charge for non-dairy milks, we’re embracing all the ways our customers enjoy their Starbucks.”
The Seattle-based coffee chain noted that when this new menu pricing rule goes into effect, almost half of Starbucks customers who pay to modify their drinks will see their drink costs go down by 10%. The change is part of Niccol’s “Back to Starbucks” plan, which also includes menu simplification and focusing on “to-stay” customers instead of just mobile order and pickups. Other recent changes under Niccol’s leadership include discontinuing the Oleato, phasing out the Princi bakery partnership, and ditching the discounting strategy.
“I made a commitment that we’d get back to Starbucks, focusing on what has always set Starbucks apart – a welcoming coffeehouse where people gather and we serve the finest coffee handcrafted by our skilled baristas,” Niccol continued. “This is just one of many changes we’ll make to ensure a visit to Starbucks is worth it every time.”
Starbucks did not yet elaborate on how removing this extra charge could potentially impact the company’s bottom line.
As reported in its preliminary results, Starbucks saw a 7% global same-store sales decline for the fourth quarter ended Sept 29, driven by an 8% decline in traffic. In the U.S., same-store sales slid 6%, driven by a 10% decline in traffic. Negative traffic trends were partially offset by increased menu prices. Net revenues declined 3% to $9.1 billion. Net income declined 8.8% to $3.8 billion or $3.31 earnings per share, as compared with $3.6 billion or $3.58 earnings per share the same quarter the year prior.
Starbucks opened 722 net new stores in Q4, ending the period with 40,199 stores portfolio-wide.
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