Starbucks is reportedly partnering with CloudKitchens, a ghost kitchen led by Uber founder Travis Kalanick, to expand its last mile capabilities, according to Insider. CloudKitchens rents small kitchen bays that can be used as pickup-only facilities for delivery drivers.
Starbucks is planning to utilize a CloudKitchens location in San Francisco starting August 22, 2023, according to city permits seen by Business Insider. The site, called Charter Oak Food Pick-Up, is located at the intersection of two highways, making it convenient for last mile operations. It will operate from 7 a.m. to 6 p.m. daily.
Starbucks CFO Rachel Ruggeri noted that while drive-thru locations offer the strongest results, pickup and delivery-only stores help ensure customers can get their orders however and wherever they need them. The company is looking to expand with “a lot of different store designs and types to be able to meet the increasing demand that we see,” she said on a June 6 call with investors.
CloudKitchens has dozens of ghost kitchens across the U.S. and operates internationally under different names. Other brand partners include Buffalo Wild Wings and Chick-fil-A.
Starbucks has been open to utilizing third-party partners to help expand its last mile capabilities for some time. The company reached nationwide coverage with UberEats in 2020 and achieved the same goal with DoorDash in March 2023. Starbucks and Target also let shoppers include Starbucks orders when they utilize curbside pickup at nearly 250 Target locations.