Starbucks Tests a New Tactic

Starbucks Corp. is at it again. This time the coffee giant plans to remove its name from one of its Seattle-area stores and add alcohol to the menu, the Associated Press reported.

The store will be called 15th Avenue Coffee and Tea and is set to open next week with a wine and beer offering in addition to coffee. The company also plans to open to two additional stores without the Starbucks name, and if the concept takes off, will consider expanding it to other areas.

Starbucks is scheduled to report its fiscal third quarter financial results on Tuesday and analysts have largely predicted another sales decline, thanks to competition from lower-priced rivals, including McDonald’s, whose McCafé line is in full swing.

Andrew Hetzel, the founder of coffee consulting group Cafemakers, told the Associated Press that Starbucks might be renaming the stores to provide a testing ground for changes and, possibly, to draw a new brand of consumer. “It looks to me that they are testing a specialty sub-brand to see if they can capture some other segment of the market that would otherwise be disillusioned by a large corporate chain,” Hetzel said, adding that opening only one at first “gives them a live shop to test changes in menu offerings, store design and, perhaps, procedures quickly” without disrupting operating stores branded with the Starbucks name.

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