Starbucks (Seattle) detailed strategies for its next phase of growth at the company’s biennial Investor Conference. Among the plans, Starbucks chairman, president and ceo Howard Schultz says the company plans to create long-term shareholder value by building a solid and secure foundation for profitable growth in both new and existing businesses. “Our next phase of growth will come from extending the Starbucks Experience to our customers beyond the third place to every part of their day, through multiple brands and channels,” says Schultz.
In the U.S. market, Cliff Burrows, president of Starbucks Coffee U.S., says growth will come from existing stores through increasing capacity and expanded day-parts, as well as through innovative store segmentation, with new concepts and formats in strategic locations. “We’ve improved store-unit economics in a significant way over the past two years,” says Burrows. “We now have the opportunity to apply these broad-based improvements to retail expansion, as we engage customers through targeted initiatives such as My Starbucks Rewards and Starbucks Digital Network, create capacity at peak hours, and capture more day parts.”
The company says it will not add stores in the U.S. at the pace it once did, but plans to add new locations in targeted neighborhoods, focusing on opening one store at a time.
Looking abroad, Starbucks International plans to accelerate growth into established markets, including Canada and Japan, as well as new or emerging markets such as China, Brazil, India and Russia. John Culver, president of Starbucks Coffee International says the company expects to operate at least 1500 Starbucks stores in Mainland China by 2015.
“Starbucks has reached a critical juncture as we move from a high unit growth specialty retailer focused on coffee in our stores, to a global consumer company with diversified growth platforms across multiple channels,” adds Starbucks chief financial officer Troy Alstead. “We are intent on capturing a larger share of coffee consumption, reaching consumers wherever and whenever they want great coffee.”