Starbucks has discontinued an AI-powered inventory management tool less than a year after rolling it out across its stores. According to a Fortune report, the company decided to stop using the system after employees raised concerns about its accuracy. The tool, developed by NomadGo, was introduced in September last year to automatically count inventory items such as milk and syrups and help stores manage stock levels. However, workers reported that the app often made mistakes, leading to operational problems.
Employee Feedback and Operational Challenges
According to Carl Addison, a Starbucks shift supervisor in Washington state, the system required stores to reorganise storage areas, adding extra work for employees. “The app’s inaccuracies made employees’ workflow more challenging,” Addison told Fortune. The AI-powered app was designed to track beverage ingredients and identify shortages. However, Reuters previously reported that the system frequently miscounted or mislabeled items and sometimes failed to detect products on shelves.
Starbucks told Fortune that it had decided to move away from the tool after reviewing feedback from employees. “We test ideas in our coffeehouses, listen closely to partner feedback, and make changes to deliver a better, more consistent experience,” a Starbucks spokesperson said. He noted that incorrect inventory counts sometimes resulted in stores receiving too much or too little stock. “It started off not particularly accurate and got less accurate over time,” Addison added.
One employee comment shared by Starbucks also welcomed the decision. “Thanks for discontinuing Automatic Counting! The thought behind it was great, but the execution was proving difficult,” the comment said.
Part of Starbucks' Broader AI Strategy
The inventory tool was launched as part of CEO Brian Niccol's "Back to Starbucks" strategy, which includes the use of AI to improve operations and customer service. Other AI tools currently used by Starbucks include Green Dot Assist, which helps employees find recipes and troubleshoot equipment issues, and Smart Queue, which is designed to speed up order processing.
The discontinuation highlights the challenges of implementing AI in retail environments, where accuracy and ease of use are critical for employee adoption and operational efficiency.
