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Why Schlotzsky's can't win using Starbucks' delivery strategy

Beto Guajardo may have a ton of delivery expertise considering he used to be SVP of global strategy for Starbucks, but as the president of Schlotzsky's, he is facing the same third-party delivery struggles as nearly any operator in the business.

November 13, 2019

Considering he used to be SVP of global strategy at Starbucks, it's safe to assume Beto Guajardo understands delivery. As the president of Schlotzsky's, however, he is facing the same struggles when it comes to third-party delivery as nearly any fast casual operator in the business.

"How do I ensure that I'm creating something that truly is unique and differentiated on a platform that I don't own when I'm showing up on just what appears to be a broader menu of product offerings?" That's just one question he discussed during a 20-minute interview last month at the Fast Casual Executive Summit in Austin.

"We are struggling with that to be honest with you," said Guajardo, who is focused on ensuring what's being delivered shows up in a way that meets the brand standards.

One of the reasons Starbucks was so successful with mobile and delivery, Guajardo said, was that customers already loved the brand.

"It is such a powerful brand," he said, pointing out that Schlotzsky's has 14,500 fewer units than the coffee giant. That makes the experience for the Austin-based sandwich chain much different — delivery from a third party like UberEats may be the first time a customer has tried the brand. And if it's not spectacular, he'll lose the customer forever.

"We have fans who love us, but there's a whole new generation of customers who haven't experienced us yet, and if delivery becomes their primary means to relate to restaurant brands and if foot traffic falls inside the physical locations because consumers are choosing to experience these brands at home, how do I win?"

Watch the interview to hear Guajardo's theories on how to do just that.