Starbucks names Laxman Narasimhan as new chief executive

Starbucks has named Laxman Narasimhan as its new chief executive.

The coffee giant said Mr Narasimhan will join Starbucks on October 1 after relocating from London to Seattle, where the firm is based.

He will work closely with Starbucks’ interim chief executive Howard Schultz through until April 1, when he will assume the CEO role and join the company’s board.

Mr Schultz said Mr Narasimhan is “uniquely positioned” to lead the company, with a demonstrated track record of growth in both mature and emerging markets.

“As I have had the opportunity to get to know him, it has become clear that he shares our passion of investing in humanity and in our commitment to our partners, customers, and communities,” Mr Schultz said in a statement.

Mr Narasimhan was most recently chief executive of Dettol-to-Vanish firm Reckitt, a UK-based consumer health, hygiene and nutrition company.

Reckitt had announced Mr Narasimhan’s surprise departure earlier on Thursday.

Prior to that, Mr Narasimhan held various leadership roles at PepsiCo, including as global chief commercial officer.

He also served as chief executive of the company’s Latin America, Europe and Sub-Saharan Africa operations.

Mr Narasimhan has also served as a senior partner at the consulting firm McKinsey & Co, where he focused on its consumer, retail and technology practices in the US, Asia and India.

Mr Schultz, a long-time CEO who helped shape Starbucks after buying it in 1987, came out of retirement and assumed the interim CEO job in March after the company’s former chief executive, Kevin Johnson, announced his retirement.

Mr Schultz also returned to the company’s board, and will remain there even after Mr Narasimhan takes over.

Mr Schultz said he had not planned to return, but wanted to help reshape the company after the pandemic, which upended Starbucks’ coffee shops and sped changes including a heavier mix of drive-thru orders.

Mr Narasimhan takes over a company with significant strengths.

Starbucks reported record demand in the April-June period as strong US sales made up for continuing closures in China, the company’s second-largest market.

But Starbucks also has challenges.

Mr Schultz has been working on a plan to remake store layouts, upgrade equipment and bolster employees, who came out of the pandemic feeling harassed and underappreciated.

Starbucks announced a one billion dollar (£866 million) investment in employee wages and benefits last autumn and added 200 million dollars (£173 million) more for pay, worker training and other benefits in May.

Still, the company faces an unprecedented unionisation effort, which it opposes.

At least 233 US Starbucks stores have voted to unionise since late last year.