Starbucks Corp (SBUX.O) on Friday announced two new types of stores aimed at capturing the growing demand for upscale reserve coffee and a separate test of an "express" store in Manhattan offering speedy service in a city where a "New York minute" is more like a nanosecond.
The moves from the world's biggest coffee chain come as it faces growing competition from high-end craft coffee sellers such as Stumptown Coffee Roasters, Blue Bottle Coffee and Intelligentsia, as well as from fast-food chains ranging from McDonald's (MCD.N) to Dunkin Donuts (DNKN.O) to newcomer Chick-fil-A.
Starbucks said it plans to open a "first of its kind" 15,000-square-foot small-batch reserve roastery in the hipster Capitol Hill neighborhood of its Seattle home market in December. The company will consolidate roasting of its reserve offerings, including Geisha and Jamaica Blue Mountain, in the facility, which will house a store, a tasting room and a cafe devoted to its reserve coffees.
The new roastery is expected to give Starbucks the potential to expand its reserve lineup from 15 to 30 offerings. Some recent Starbucks reserve coffees sell for $15 to $50 for an 8-ounce package.
Starbucks also plans to open at least 100 reserve-only cafes globally over the coming five years. It declined to give more details.
"We plan to take this super premium experience to cities around the world," Starbucks Chief Executive Howard Schultz said in a statement.
Starbucks also plans to test its first "express" store in Manhattan in 2015. The company said the New York store would be small and convenient, with a limited food and beverage menu. It will use digital payment and mobile ordering to speed up service. Starbucks declined to say how many express stores are planned.
(Reporting by Lisa Baertlein in Los Angeles; Editing by Leslie Adler)
