Starbucks was using technology from Redmond-based NomadGo to automate how workers counted inventory items. (Starbucks Photo) When Starbucks scrapped an AI-powered inventory counting tool back in May, just nine months after revealing the new system, it landed as a surprise to those tracking the coffee giant’s high-tech ambitions. A new report from Fast Company tells the inside story of how the national rollout disintegrated — and why the Redmond, Wash.-based startup behind it was left “blindsided.” Known as “Automated Counting,” the tool was built in partnership with NomadGo to scan backroom storage shelves using iPad Pros equipped with computer vision, spatial computing, and augmented reality.
It was designed to automatically tally coffee bags, milk, syrups, and other key supplies. The idea was to turn an hour-long manual chore into a 10-to-12-minute job so baristas could focus on making drinks and connecting with customers. The technology was deployed rapidly across all 11,300 company-operated Starbucks locations in North America.
But almost immediately, real-world store environments triggered rampant glitches, according to Fast Company. Baristas reported camera errors — such as shiny refrigerator reflections doubling milk counts or the app misidentifying syrups and trash cans — while stores with spotty Wi-Fi frequently had their counting progress wiped out entirely mid-scan. According to Fast Company, the technical breakdowns stemmed from both software limitations and outdated infrastructure.
While NomadGo’s computer vision achieved 99% accuracy in controlled tests, CEO David Greschler noted that computer vision inherently struggles when inventory changes — requiring up to six weeks of retraining for seasonal holiday cups or limited-time packaging that NomadGo developers sometimes only learned about once items hit store shelves. Compounding the problem, people involved in building the tool pointed to Starbucks’ backend network, which relies on a legacy IBM AS/400 system dating back to the 1990s, making it difficult for cutting-edge AI to process real-time store data reliably. When Starbucks notified NomadGo on April 3 that it was pulling the plug, the startup was reportedly blindsided.
Greschler called the decision “a complete surprise,” telling Fast Company that “there’s nothing you can do when leadership and strategy change.” Within days of losing its c…
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