Starbucks Ready for Growth Again

Starbucks is ready to start opening cafes again after a couple years of cost cutting resulted in the closure of hundreds of locations. During its fiscal year, the company plans to add 100 US stores as well as 200 internationally.

Management has high expectations for improved sales growth as the economy recovers. Starbucks also declared its first dividend at its annual meeting of shareholders yesterday.

Tim Horton’s Takes on America

Counter Culture should get renamed Coffee Culture lately. Recently, we had a popular discussion on guns in Starbucks and the viability of Juan Valdez franchising cafes in the US. Today the topic is Canadian chain Tim Horton’s.

Over the next three years, the company will open 300 outlets in the US. The unit growth will increase its presence here from the 563 locations it currently operates, and management wants to revamp the brand by going more bake-shop upscale, than say, the typical Winnipeg location.

Is There Room for Juan Valdez Cafes?

The Columbia-based parent company of the Juan Valdez coffee chain is looking to franchise stores across North America in attempts to expand the brand. Outside of Colombia it only runs about 27 locations.

But so far the company-owned units haven’t had the best of luck in the US. It closed locations in Seattle, Washington DC and one in New York’s Times Square.

Guns Are Allowed in Starbucks

We were surprised to see that Starbucks allows customers to bring firearms in its stores where local laws allow for the carrying of unconcealed weapons. The chain does this in some areas despite the fact that it doesn’t have to and other retailers have their own policies banning guns.

According to the Assoociated Press, Starbucks’ smaller rival, Peet’s Coffee & Tea, doesn’t allow its customers to carry firearms, nor does California Pizza Kitchen.

Starbucks Turnaround in Full Swing

It seems like things are improving at Starbucks. The coffee giant posted first-quarter earnings of $241.5 million, and a same-store sales gain of 4%, it’s first since 2008.

Executives attributed the improvement, in part, to its new Via instant coffee. Starbucks also cut costs and closed stores in the last year and a half.

Burger King Goes Upscale?

Burger King looks like it’s trying to do the Starbucks thing. The burger chain is remodeling all 12,000 of its restaurants with a look that “includes rotating red flame chandeliers, brilliant TV-screen menus and industrial-inspired corrugated metal and brick walls,” according to an Associated Press article.

The company is trying to set itself apart from McDonald’s and compete with all of the regional chains offering a higher-quality product, the article says. One analyst isn’t convinced that the move will attract new customers, though, saying that perceptions about the Burger King brand are pretty well entrenched.

Empty Bank Branches Add to Retail Woes

The Wall Street Journal reports that retail landlords now get to deal with the fallout of major bank branch closures. It seemed not too long ago that other retailers were complaining that they couldn’t afford leases in prime areas because banks were willing to pay so much more.

Well, that’s not really the case nowadays. One bank, Washington Mutual, which was getting more prominent in some areas than Starbucks, has closed about 400 units since its merger with JPMorgan Chase. Bank of America is shaving back 10% of its 6,000 units.

Starbucks Selling Beer and Wine?

It looks like Starbucks is trying to emulate the small-operation coffee houses that many claim it’s put out of business for years. In its headquarters city of Seattle, the company is test marketing a concept that will sell beer and wine and host local events like poetry readings.

What we find most interesting about this is that the prototype, called 15th Avenue Coffee and Tea, won’t even bear the Starbucks name. Instead, these stores, which could roll out nationally if they work in Seattle, will get named after their respective neighborhood locations.

Starbucks Fights Back With Ads

So it seems that Starbucks, isn’t above television advertising again.

The coffee giant has decided to start testing advertising in Indianapolis and Jacksonville, FL, most likely as a response to those horribly annoying McCafe ads that McDonald’s is pushing all over the place.

We’re interested in seeing how they promote affordability. We liked Starbucks’ crazy campaign from a few years back.

Retailers Say Rent Relief Is Working

Another interesting article appeared today on rent relief at shopping centers.

Apparently Starbucks has had success in receiving concessions from landlords, in its quest to lower rents by as much as 25% at some of its locations. Additionally, jeweler Zale Corp. earlier this week joined the ranks of retailers looking to catch breaks, and we wrote about Charming Shoppes’ strategy yesterday.