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Starbucks: Expanding beyond coffee

In recent years, Starbucks has embarked on a growth strategy known as the ‘accelerated growth plan’ in an effort to grow the business. A key part of this initiative, as discussed in the case study ‘Starbucks Corporation: Accelerated Growth Plan’ , has been the expansion of in-store offerings beyond coffee. In order to aid this expansion Starbucks made a number of acquisitions, namely of Evolution Fresh, La Boulange, and Teavana.

Following the purchase of Evolution Fresh in late 2011, the company set out aggressive growth plans with the plan being to have the juices available in over 5,000 US stores by the end of 2013. The company exceeded these targets, with Evolution Fresh juices now available in over 8,000 locations, including Starbucks stores and grocery stores throughout the US. Furthermore, following the opening of the first Evolution Fresh store in Washington in 2012, the company has since opened three more in Seattle and San Francisco.

The acquisition of La Boulange, in July 2012, has further helped in Starbucks’ quest to expand the company beyond coffee. Starbucks has increased its food offerings and taken control of a number of bakery stores. Furthermore, the company opened its first restaurant in June 2014 with the La Boulange restaurant opening in Los Angeles, serving breakfast, lunch, and dinner between 7am and 10pm, seven days a week.

The acquisition of Teavana in November 2012 led to the company opening its first Teavana Fine Teas + Tea Bar in New York in October 2013. The company has since opened a further three of these tea bars in the US in Seattle, Chicago, and Los Angeles. These stores offer specialty tea and accessories for the home. Starbucks plans to expand its tea bars and become one of the leading market players in the tea industry.

The company is further enhancing its offerings beyond coffee with the introduction of ‘Starbucks Evenings’. The company announced in March 2014 that it would be introducing Starbucks Evenings to a number of stores in the US. This initiative would start after 4pm and sell alcoholic beverages to consumers, with the options being bottled beer or wine. Starbucks also plan to offer snacks to go with these alcoholic beverages.  The rollout of this program will begin during 2014 and will take place over several years, with the long-term goal being to have more than 1,000 stores throughout the US offering Starbucks Evenings.

Posted in Drinks, Food, Restaurants.

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