Starbucks has hired a new CEO to help offset declining sales.

Matt Rourke/AP

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Matt Rourke/AP

You know things are tough at Starbucks when the company preemptively reveals bad news, which it did last week to stay ahead of its earnings deadline on Wednesday.

Sales in the US have been declining for months, fell 6% last quarter Compared to last year, it was the worst quarter since the closures during the pandemic. The number of purchases fell by 10%.

The chain's new CEO is now ordering a change: a plan he calls “Back to Starbucks,” reminiscent of a time when Starbucks was simpler, cheaper, cozier, cooler – and thriving.

“We have to fundamentally change our current strategy,” says CEO Brian Niccol a video speech about two months after starting the job. He mentioned plans to “simplify our overly complex menu,” adding, “We need to re-establish ourselves as a community coffeehouse.”

In the absence of further details, speculation is rife online: Will cafes get soft sofas? Will Starbucks limit syrups, toppings and customizable drinks that are vilified as “frank drinks”? Will it reopen its condiment bar, where people poured their own milk and sweeteners before the pandemic?

A company representative told NPR that the CEO's plans are still being implemented. Some details could be revealed on Wednesday, when Niccol answers investors' questions for the first time.

Too fancy to be simple, too simple to be fancy

Two women with paper cups chat at a table near an airy new Starbucks in the upscale Washington suburb of Bethesda, Maryland. Upon closer inspection, it turns out that the cups came from another coffee shop a block away.

“We’re just here for the sun,” says one of the women, Tamar King. “This is a park.”

In fact, this Starbucks is rife with competitors: This busy downtown stretch has 11 coffee spots within a two-block radius. These include the usual suspects Dunkin' and Panera, trendy options Tatte Bakery and Ceremony Coffee Roasters, and even another Starbucks. This kind of competition didn't previously pose a threat to the coffee giant, but it has grown significantly.

In a video address, Starbucks' new CEO Brian Niccol says the chain's strategy needs a “fundamental change.”

NPR screenshot/video address from Starbucks CEO

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NPR screenshot/video address from Starbucks CEO

There is also another battlefront. The company that got America excited about coffee is now competing not only with other coffee shops, but also with all the fancy coffee machines people have at home or at work.

That means Starbucks is stuck in the middle: too fancy to be simple, too simple to be fancy.

“I went (to Starbucks) every day for years,” King said. What has changed? “The office I work in has a fantastic coffee machine. Fantastic.”

Niccol talks about Starbucks losing occasional customers. But once loyal visitors are also at stake.

“We loved it so much for years,” said Lisa Janofsky, who stopped by the Bethesda Starbucks with her husband, Jerry, to redeem his rewards card: a free Venti Skim Latte as a gift for his birthday.

They went to Starbucks every day. But now they are gravitating towards gourmet coffee shops if they want the “community feel” and great coffee taste. They estimate that daily lattes are made at home for about $1 per cup.

“We have a nice machine at home that we use,” says Jerry Janofsky. “And my wife is a great barista, she creates designs for me.”

On the wish list: better beans, cheaper drinks, latte art

Lisa Janofsky says she would visit more often if Starbucks beans tasted less burnt, size options included a short latte with just a shot of espresso and if baristas made latte art.

The prospect of baristas making designs on the milk foam is hard to imagine at the pace Starbucks operates, especially during the morning rush. Mobile orders often pile up, stores are overcrowded, and employees are overwhelmed.

“We need to address staffing in our stores, eliminate bottlenecks and make things easier for our baristas,” says Niccol, the new CEO. “We need to refine mobile ordering and payment so it doesn’t overwhelm the cafe experience.”

Starbucks is betting big on Niccol, literally. The coffee company lured him from Chipotle, where he relaunched after a year Series of foodborne illness outbreaks. He was able to earn money at the coffee giant one of the highest paychecks in the industry – more than $100 million – if he manages to turn things around.

His challenges are diverse.

Several shoppers in Bethesda express their disappointment with Starbucks still fighting its unionized stores. The chain has lost its footing in China. It is faced with boycotts in the Middle East and Asia over the company's alleged support of Israel in the Gaza conflict. A woman in Maryland says that's why two dozen people she knows in the U.S. have also stopped going to Starbucks.

And by far the biggest complaint?

“It's way too expensive,” said Anjeli Smith, a regular Starbucks coffee worker who was meeting a friend that day for a cold brew with pumpkin cream. “I usually only use my gift cards for birthdays and graduations.”

Niccol is likely to be asked about his pricing plans when he speaks to investors on Wednesday. So far, he has been vague, promising to “correct our pricing architecture and ensure that every customer feels like Starbucks is worth it on every single visit.”