Starbucks Brews In-House Tools in Shift From Big Tech
Starbucks is developing in-house systems that could replace software it buys from Big Tech companies, Bloomberg News reported Thursday (July 9).
The coffee chain is working on alternatives to a system from Microsoft that monitors inventory as well as a maintenance management tool from IBM, the report said, citing an internal presentation.
Starbucks has also been working for several years on creating a point-of-sale system that would replace Oracle Simphony, according to the report.
Starbucks did not reply to PYMNTS’ request for comment.
The moves are part of a larger shift happening in the business world.
“For two decades, buying enterprise software meant accepting a vendor’s feature set, paying per seat and hiring specialists to manage the platform,” PYMNTS reported Wednesday (July 8). “For small businesses, that model often meant paying for capabilities they never used. AI coding tools are changing that calculation.”
Five startups and small companies with staff ranging from 20 to 70 people switched from working with Salesforce and HubSpot in the last six months, turning instead to in-house applications built using AI tools from Anthropic, Lovable and Replit. These businesses reduced software costs by 40% to 80%.
Research and advisory firm Gartner found that up to $234 billion of enterprise application software spending will be exposed to agentic arbitrage by the end of 2030, or roughly 20% of all enterprise software-as-a-service spending.
“Agentic AI changes the economics of software,” George Brocklehurst, managing vice president at Gartner, said in a July 1 news release.
Retool, a low-code platform for building custom internal tools, found that 35% of enterprises have already swapped out at least one SaaS tool with a custom-built alternative, with 78% saying they intend to develop more this year.
Starbucks spends roughly $400 million per year just on software, Chief Technology Officer Anand Varadarajan told employees in an internal forum earlier this year, according to the Bloomberg report.
“There’s clear opportunities to reduce the spend in software,” Varadarajan said, per the report.
While in-house software can be cheaper for companies like Starbucks, which hopes to lower costs by $2 billion for its turnaround plan, building can lead businesses to pay more for maintenance and labor, the report said.
