Starbucks has once again been making headlines recently with a new big change to its policy that has caused much discourse. Most notably, the company closed the door (literally) on its once-lauded “Open Door” policy. This change also means that “guests at Starbucks must now purchase a beverage if they want to stay in the store or use their bathrooms.” The decision is a significant break from Starbucks’ previous customer service and community engagement approach, which has elicited mixed reactions from customers, communities, and industry experts.

Starbucks closed Its “Open Door” Policy: A Framing The Historical Context

The so-called “Open Door” policy dates back to 2018, when it was instituted as a response to a highly publicized incident in Philadelphia. In particular, the arrests of two Black men who had not made a purchase and were waiting for a business meeting were seen as racial profiling. As a result of the incident, Starbucks introduced the policy to create a more welcoming space and ensure that similar incidents do not happen in the future. The company even shuttered 8,000 stores for a day last week to hold racial-bias training sessions for all its employees as part of the initiative. The policy was meant to ensure that everyone, even if not purchasing, was welcome in Starbucks stores. But, over the years, the policy started to really falter. Employees and customers have complained about rowdy and potentially perilous behavior in stores, including drug use and other disruptive activities. These needed to fix issues with the stores that threatened the safety of workers and customers, and they recently closed 16 stores in the United States over safety issues. As a result, the company was forced to reassess its strategy towards store management and customer service.

So why reverse the “Open Door” policy? 

There are a number of reasons for this decision: 

• Operational difficulties in keeping a warm and inviting atmosphere while dealing with non-paying guests. 
• The safety of the workers and guests. 
• Cleanliness in the face of overcrowded environments. 
• Prioritizing paying customers and their experience. 
• And finally, a general redirection under new management to right-slant declining sales and eventually restore the coffeehouse again to a spot in the communityAs a matter of fact, it also fits nicely with a new focus in Starbucks with efficiency and throughput in mind with the growing trend of mobile orders and drive-thru. Those channels now represent more than 70% of Starbucks’ sales in the U.S., signifying a meaningful operational pivot — that includes simplifying processes and lowering expenses.

The New Code of Conduct

Starbucks also implemented an updated code of conduct with the end of “Open Door” policy. With the new regulations, customers must buy something if they plan to stay in the store or use the restroom. The code also prohibits discrimination and harassment, the consumption of outside alcohol, smoking, vaping, drug use and panhandling on the premises. The important note is that anyone who breaches these rules will be asked to leave and if necessary law enforcement will be involved. 

Starbucks is training employees on, well, the new rules about the new rules. With this post, the company thinks it can establish a better environment for the wider community of renters. It is an attempt to reconcile the desire for an inviting ambience with the realities of operating a safe, commercially viable establishment.

Public and Press Responses

Public and media reactions to Starbucks’ policy change have not been uniformly positive. On one side, the policy change left a lot of customers disappointed. Starbucks used to represent a third place to them, where people could lounge, study or meet friends without the pressure to make a purchase. Some see this change as an divergence from the community-first brand that Starbucks has championed for decades. But some patrons agree with the decision, saying that it helps keep a more orderly and pleasant atmosphere. They contend that the purchase mandate can help reduce overcrowding and ensure access to seating and facilities for paying customers. This practicality responds to a larger perspective shared by the company to enhance the customer experience. 

Coverage in the media has been widespread, emphasizing within all of that coverage the implications on corporate responsibility for social good. Others, however, have drawn attention to the perils of the policy and whether it reflects Starbucks’ professed values of inclusivity and community engagement. Others have zeroed in on the practical benefits of the policy, pointing to customer experience and operational efficiency as core to the business.

This policy change has a wide-ranging effect on Starbucks’ business operations. First, by requiring purchases, more of the visitors would become customers, driving up your sales numbers. This move is an alignment with Wall Street’s insistence on greater efficiency and profitability. 

Secondly, it aids in controlling store crowds and limiting footfall of those who are not customers, reducing pressure on manpower and infrastructure. But there are potential downsides to be aware of. Example being it could alienate existing customers who appreciated the former policy’s inclusiveness. In addition, Starbucks will have to dedicate resources to train employees to enforce the new rules effectively, which could be an added cost. And, as mobile and drive-thru orders have led to a focus on the speed and efficiency of orders, the prospect for personal interactions between baristas and customers has diminished. Critics have decried this as diluting the singular Starbucks experience customers loved. Starbucks is tackling this challenge with significant investments in new store formats and in technologies to help them do better in delivering the service customers are expecting, while also attempting to maintain at least some aspects of the third place feeling.

Customer Experience and Community Response

In your answer please refer to the impact of a generic company policy change on customer experience/impact of such a policy on community response. This received mixed responses from customers, some having appreciated a more controlled and customer-centric space, while others felt it took away from the community feel Starbucks was known for. You have to buy something if you want to be in a Starbucks or use the bathroom; if Starbucks was a place they could hang out, they have now lost that. Reactions from the community have also been mixed. Others in the community worry that this policy change could have a disproportionate impact on those who depend on Starbucks as a safe, clean place to be — such as the homeless. Opponents claim that the approach may promote greater social exclusion and stigmatization of at-risk populations. On the other hand, other responses from the community welcome the change, indicating that it can lead to a more moderated and enjoyable atmosphere for all customers. They contend the policy may assist Starbucks in better controlling its spaces and reserving amenities for those who add to the establishment.

How It Compares to Other Companies

Starbucks isn’t the first company to make a policy shift like this. To conserve resources, some other big retailers have also said customers must make a purchase in order to use their restrooms. McDonald’s — which has made headlines in the past over its restroom policies, some locations of which require customers to buy something before being allowed to use restrooms — has faced similar scrutiny. The results also varied, as some companies faced backlash and others saw an improved customer response. On the retail side, a lot of stores have become policy-driven in terms of ensuring that customers check in with staff members before trying on clothes in the fitting room. This method is meant to combat theft and free up fitting rooms for customers who are serious about buying. Although the outcome has become favorable in terms of loss avoidance, it can at times, create disgruntled consumers when the process is seen as cumbersome. Airlines have similarly raised the number of carriers liable to pay for checked baggage. At first, customers, who were used to free baggage, were not too happy about this change. As such, the result has been a lucrative one for airlines, as they have added top-line revenue, whilst in many cases this has come at the expense of customer satisfaction and a reputation of being a nickel-and-dimer.

Expert Opinions on the Changes Around Retail Policies: The Case of Starbucks’Closing the Door on Its Open Door Policy

Retailing Experts Talk Embedded Cost： Are Businesses Going Too Far With Requiring Purchases Before Toilet Use Some analysts say this could streamline operations and lead to greater customer satisfaction. They argue clean and accessible restrooms are essential for bringing in and retaining customers and that a clean restroom indicates a well-run business. But others warn that such policies could engender bad feelings and less foot traffic. They explain that while restricting use of restrooms only for customers making a purchase can help with upkeep and deter misuse, it could also reduce foot traffic from customers who opt to go elsewhere where restrooms are more welcoming. Ultimately, experts say, successful interventions like this one hinge on how they are implemented — and how they reassure the population. They would advise businesses to weigh operational requirements against customer expectations when setting restroom policies.

The Policy Crossroads of Starbucks

Delete this SCENARIO IN BACKGROUND: Starbucks is closing the door on its “Open Door” policy, ending one of the last bastions of employee representation at its stores. At the same time, the company must balance the needs of paying customers with its pledge to community engagement during this transition. Here’s how the company is trying to strike that balance:

• New formats for stores, such as pickup-only and drive thru• Upgrading its ability to make orders via mobile. 
• Investing in new coffee-making equipment that will improve the speed and quality of serviceAll of these initiatives capture Starbucks’ focus on giving the consumer what they want and still trying to overcome operational strain. However, the long-term impact of these changes is expected to have far-reaching implications on the decisions on the retail industry going forward. Starbucks’ path will be an essential lesson for the global business community, as they struggle with parallel dilemmas of maximizing efficiency, profitability, and social conscience. Ultimately though, there is an internal balance in all brands, and so it will be interesting to see how that balance operates in Starbucks new policy going forward. Whether it be in how or why the company opts to communicate and/or implement such changes can be the difference between aligning these business strategies with community values. October 2023, only time will tell if this policy change is helming well for Starbucks reprieve as a brand that is in tune with its costumers, or if they are steering to a change in a perception as how was been done with Starbucks.