A potent double-double
Starbucks to sell booze at some American outlets
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Hey there, time traveller!
This article was published 30/01/2012 (4998 days ago), so information in it may no longer be current.
CHICAGO — Bringing happy hour to Starbucks may be easier said than done.
After experimenting with alcohol sales at six American West Coast stores, the world’s largest coffee-shop chain says it will sell beer and wine in as many as 25 locations by the end of the year. Starbucks, which has 10,700 U.S. cafes, will also sell fruit-and-cheese plates and focaccia with olive oil.
The strategy is part of a broader experiment to find ways to lure Starbucks customers and even non-coffee drinkers into stores during slow periods of the day, especially afternoons and evenings.
The trick will be doing it without alienating core customers, said Bill Chidley, a Centerville, Ohio-based senior vice president at Interbrand, a brand consulting firm.
“It makes sense if you think of the way that McDonald’s grew its business by going into breakfast” and specialty coffees, Chidley said in an interview. Still, selling alcohol may turn off some families with children, he said.
“It certainly is going to be controversial,” he said.
The wine and beer initiative is part of an effort by chief executive officer Howard Schultz to cement a turnaround he engineered starting in 2008. Starbucks shuttered hundreds of cafes after overbuilding and a consumer-led recession sent sales and profits sliding.
Sales have rebounded since Schultz reclaimed the CEO post in 2008. Revenue rose 20 per cent to $11.7 billion worldwide in the year ended Oct. 2, from $9.77 billion in 2009. Profit more than tripled during the same time. Starbucks has captured 33 per cent of the $26.5 billion U.S. coffee and snack shop market, according a July report from researcher IBISWorld Inc. Dunkin’ Donuts has 16 per cent of the market.
Starbuck’s shares climbed 43 per cent last year, compared with a 16 per cent gain for the Bloomberg U.S. Quick Service Restaurant Index, which includes McDonald’s, Krispy Kreme Doughnuts and Wendy’s.
In recent years several restaurant chains have sought to boost growth by transcending their origins.
McDonald’s has successfully moved beyond fast food into coffee beverages, opening McCafe bistros with earth-tone decor and free Wi-Fi. McDonald’s also expanded its menu offerings — including fruit smoothies, salads and wraps — with the aim of attracting people around the clock.
— Bloomberg News