Starbucks’ expansion slow amid pandemic

by NUR HANANI AZMAN / pic by TMR FILE

BERJAYA Food Bhd (BFood), the franchisee of Starbucks Coffee outlets in Malaysia and Brunei, predicts better business prospects in 2021 in terms of cost management initiatives and also ensuring efficiency in its operations.

BFood Group CEO and Starbucks Malaysia & Brunei MD Sydney Quays (picture) said Starbucks business now accounts for more than 80% of revenue contribution to BFood.

“We continue to see strong performances, driven both by our drive-thru stores and through orders from the delivery platforms despite dine-in not being available.

“Once the pandemic recedes and the economy is allowed to resume normally with dine-in and cross-district travelling, we do expect to see an increase in sales as we did earlier in the year when we were in the Recovery Movement Control Order,” he told The Malaysian Reserve.

Under normal circumstances, BFood 100%-owned subsidiary, Berjaya Starbucks Coffee Co Sdn Bhd opens around 30 stores a year.

“With the Covid-19 pandemic and movement control orders affecting the construction industry, that number will be potentially reduced this year. We are committed to growing the business given the right conditions,” said Quays.

“Traditionally, most of our business relied on customers to stay-in and enjoy their drinks in the cafes but as Covid-19 hit what we’re seeing is an increase in our drive-thru as well as delivery business.

“The uncertainty of the Covid-19 pandemic has shifted consumer behaviour in a way that has changed the way we interact with our customers,” he added.

After more than two decades in Malaysia, Quays said Starbucks was able to adapt to the shifting needs of customers through various marketing tactics and cost-saving initiatives.

“This year, we expanded our digital customer relationships and engagement by creating new occasions and experiences to make transactions even more convenient and personalised, which has resonated strongly with our customers,” he reckoned.

He said everything Starbucks does in technology is centered around customer connection in the store.

“This extends not only to the key touchpoints within our stores, such as digital menus and community boards, but also through our mobile app. At the end of June, we launched our new Starbucks Rewards programme, which transitioned from a transactional-based loyalty programme to a spend-based loyalty programme, providing more flexibility and choices for our customers,” he said.

For this programme, the company invested not only in the platform technology, but also in the structure of the system, which would allow it to make even more enhancements to digital customer experience and introduce new innovative features before the end of this year, he added.