Struggling Starbucks Turns To Beer and Wine

 

Is the coffee business tanking? Whispers began earlier this month that Starbucks would be testing out ‘European-style’ coffeehouses on this side of the pond in an effort to combat their falling profits. Confirmed by USA Today late last week, the Northwest company will open a new test location in the Seattle area offering coffee, tea, and alcohol. The “15th Ave. Coffee and Tea inspired by Starbucks,” set to open next week, will include a small beer and wine selection ranging from $4-$7 for interested customers.

“We’ll be equally as proud of our beer and wine as we are of our coffee,” [Starbucks senior project manager Major] Cohen says.

The coffee giant has had a rough year, closing nearly 600 stores in early 2008 and implementing other trial menu initiatives, including smoothies and ‘drinkable sorbets’. While evolution is the key for a company’s growth, some are skeptical of the latest Starbucks move.

The test move to sell alcohol is clearly an attempt to fight off growing competition from McDonald’s and Dunkin’ Donuts, says Ron Paul, president of Technomic, a restaurant consulting firm. “But if I were sitting in Seattle, I’d go after the evening snack and dessert business, not alcoholic beverages.”

~Jennifer Heigl

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