Starbucks is scrapping an AI-powered inventory management system after less than a year of use, following widespread complaints from employees about inaccurate tracking and frequent errors.
Reuters reports that the coffee giant rolled out its Automated Counting software across North American stores in September 2025, developed in partnership with technology firm NomadGo. The AI-powered tool was designed to streamline inventory tracking by allowing employees to scan shelves using mobile devices, automatically identifying and counting items like milk varieties, syrups, and other supplies.
The system promised to revolutionize how Starbucks managed its supply chain, reducing the time workers spent manually tallying inventory while improving accuracy. In a September blog post that has since been deleted, Starbucks Chief Technology Officer Deb Hall Lefevre described the technology enthusiastically. “With a quick scan using a handheld tablet, partners can instantly see what’s in stock — ensuring cold foam, oat milk, or caramel drizzle are always available,” she wrote. “Customers can enjoy beverages their way, every time — and partners spend less time in the backroom and more time crafting and connecting.”
However, the reality of the system’s performance fell far short of these ambitions. The tool frequently mislabeled products and miscounted inventory items. Employees reported that the system would often confuse similar milk types or skip items entirely during scanning sessions. The problems were significant enough that Starbucks made the decision to discontinue the program after just nine months of operation.
Ironically, the promotional video embedded in the September blog post appeared to foreshadow the system’s struggles. The clip inadvertently captured the technology missing a bottle of peppermint syrup as an employee scanned a shelf, a preview of the accuracy issues that would plague the tool throughout its brief deployment.
The decision to abandon the automated system means Starbucks employees will return to traditional manual inventory counting methods. An internal company newsletter viewed by Reuters informed workers of the change, stating that beverage components and milk will now be counted the same way as other inventory categories in stores.
The failed experiment highlights the challenges companies face when implementing AI solutions in real-world operational settings. While AI technology continues to advance and find successful applications in various industries, this case demonstrates that not every deployment delivers on its promised benefits. The gap between theoretical capabilities and practical performance can be significant, particularly when dealing with the complex variables present in retail environments.
Breitbart News reported in February that Starbucks is attempting to reverse its sales decline by deploying AI and automation:
Starbucks is implementing new technology at locations across the United States, where customers at some drive-through locations are now being greeted by AI robots that take their orders instead of human staff members. Inside stores, baristas have access to a virtual personal assistant that helps them recall recipes and manage their work schedules. In the back rooms, scanning tools have replaced the manual inventory counting process, eliminating one of retail’s most time-consuming tasks and addressing stock shortage issues that have plagued the company.
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Read more at Reuters here.
Lucas Nolan is a reporter for Breitbart News covering issues of AI, free speech, and online censorship.
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