Why the pickup-only coffee shop model is winding down

Starbucks will phase out its pickup-only store format by 2026, affecting nearly 90 locations across more than 20 US states. The company announced the move on its latest earnings call after third-quarter net revenue rose 4% year over year to $9.5 billion, while North American same-store sales fell 2%. Executives said customers want face-to-face interaction and a cafe atmosphere rather than a cold handoff window.

The format launched around 2019 in airports, campuses and office districts, with small footprints, fewer staff and low overhead, which cut the average startup cost for a coffee shop of this type. Pandemic-era demand made it look like the future. Six years on, leadership calls the stores too impersonal and out of step with the brand. Roughly 90 sites will be adjusted or closed.

Starbucks dropped a bombshell at its latest earnings call: it will completely phase out the "Pick-up Only" store format by 2026. This decision affects nearly 90 stores across more than 20 states in the US. Once upon a time, these small stores focused on "order online, pick up in-store" were seen as the future direction of coffee consumption, especially popular during the pandemic. However, six years later, Starbucks executives found that consumers crave face-to-face interaction and a warm café atmosphere, rather than cold pickup windows. The CEO bluntly said such stores are "too cold and lacking in human touch," running counter to Starbucks' core brand philosophy. This article will review the rise and fall of the pickup-only store model, Starbucks' strategic shift, and the brand's future plans on the digital path.

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Starbucks released its third-quarter financial report for the period ending June 29, 2025 last week. Data shows that the company's consolidated net revenue grew 4% year-over-year to $9.5 billion, yet same-store sales in the North American market declined by 2%.

In the subsequent earnings call, Starbucks' CEO made it clear: the company will fully phase out "Pick-up Only" stores—that is, stores that only offer beverage pickup service—before 2026. According to media estimates, this decision will affect the operational direction of nearly 90 stores across more than 20 states in the US.

According to USA Today, Starbucks rolled out a new market strategy around the time of the pandemic in 2019, opening pickup-only stores in multiple airports, universities, and office building areas across the US. Customers only need to order through the mobile app, and upon arriving at the store, they can directly grab their drinks already made by baristas without waiting in line.

Compared to standard stores, pickup-only stores have smaller footprints and require fewer employees, thus reducing both startup investment and daily operating costs. Combined with the fact that this model happened to match consumer needs during the pandemic, these stores were widely favored by customers after opening. At the time, Starbucks executives even judged that "fast pickup, no waiting" could well become the mainstream trend of future coffee consumption.

However, reexamining this model six years later, Starbucks management found that pickup-only stores gradually lost consumer favor after the pandemic ended. They observed that a large number of customers seem to prefer face-to-face interaction and consumption experiences, willing to walk into traditional coffee shops, sit down, and enjoy a cup of coffee while chatting or working.

In fact, more and more customers also believe that these "pickup-only, no seating" stores, while efficient and convenient, lack atmosphere and human warmth. As a result, after the pandemic ended, pickup-only stores' business conditions deteriorated, with few customers. In response, Starbucks' CEO did not mince words: "We found this store format too cold, lacking in human touch, and it has deviated from the most core trait of the Starbucks brand: warmth and connection."

In the CEO's view, Starbucks should strive to reclaim the "third place" that once made people willing to walk in, sit down, communicate, and feel the atmosphere. The human-touch-lacking pickup-only stores conflict with this philosophy and do not align with the "Back to Starbucks" business tone he has established.

Based on the above judgment, Starbucks officially announced the halt of the pickup-only store model. The 90 existing pickup-only stores in the US will gradually cease operations, with some permanently closing and others being converted into traditional coffee shops after closure.

However, although Starbucks has decided to adjust its store market layout and phase out pickup-only stores that no longer meet current needs, the brand stated in a statement to USA Today that it has no plans to stop its digitalization process for now. Starbucks pointed out that orders placed through mobile phones already account for 31% of its overall transaction volume. Fast and convenient mobile ordering and payment will remain a key direction for the brand's future operations, and the digital model will only make physical store operations more efficient.

Image source: Internet

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