Operations

Starbucks zeroes in on waste reduction

The coffee giant says it loses $500 million each year to waste.

Starbucks is doubling down on its waste-reduction efforts, laying out plans to cut its waste costs by about 15% over the next 18 months.

The coffee company loses about $500 million each year to waste, executives revealed during a recent earnings call.

“That figure will always be significant because product availability combined with our strict product quality requirements inherently result in a certain amount of waste in our business model,” CEO Kevin Johnson said during the call.

Lower-performing units typically have the highest amount of waste, Starbucks executives said.

“We’re going after each one of those stores to improve their waste performance by store–very detailed work,” Starbucks Chief Operating Officer Rosalind Brewer said during the call.

Recently, Starbucks has targeted stores that generate the highest amount of waste as a percentage of sales with training focused on bakery pull-to-thaw processes.

Waste reduction is also being considered as Starbucks develops its Mercato line of grab-and-go salads, sandwiches and snack boxes, Brewer said.

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