Monday, January 25, 2010

Starbuck's -- Back on Track?

Starbucks new concept store, 15th Avenue Coffee & Tea.

I admit it. I like following the Starbucks story. A few days ago, the New York Times ran a story featuring their latest concept in retail (shown above), which includes selling beer (did I read that right?). Then today I saw a report that their instant coffee, Via, was selling well (and I can't believe I read that, either).

Regardless of what you think of ol' Starbucks, what they have accomplished is incredible and may never be repeated in the retail food business again. The numbers: 20 years / 15,000 stores / 10 billion dollar annual revenue. Not too shabby.

I have been a critic in the last couple of years, but they deserved it. Their latest, always-on-tap Pike's Place coffee is terrible, -- but more to the point, they built too many stores, over-extended their product line, and they were hemorrhaging cash.

Founder, Howard Schultz has returned in the hopes of turning things around. And things are looking up a bit. They are encouraged by the success of Via Instant, which I thought was a bad idea, but which was a profitable part of an otherwise unprofitable year. They have their Clover machine being tested, which, rumor has it, makes a fantastic espresso, and they even have redesigned stores like the one picture above, that are doing well.

I'll always support the locally-owned coffee shop, but for some reason, their life expectancy is pretty limited around here. Let's hope the folks at House do well, Starbucks' success or not.


Jake Good said...

So I tried some Via... and I tell you what, if I didn't french press every day, I would have a box of those sitting around for when I couldn't get to the drive through (3 blocks away :: grin ::)

Also, as many times as I've been by the shops in NYC that have the Clover machine, I haven't tried it. I hear great things though!

We'll see what happens... I think they still have a viable business, I don't think that McDonald's and their McCafe went as far as they had hoped...

Francis Shivone said...

Jake ---I guess I need to try Via again. My first experience was not good. I look for a Starbucks rebound, like when Jobs returned to Apple. People forget, they were on the ropes, now look at them.