Starbucks has recently announced that it will be cutting down its US Menu size by at least 30% as part of its effort to push its business further and focus on revenues and profit that failed to generate during the recent period.
According to Chief Financial Officer Scott Maw, the Seattle-based coffee company is planning to axe out around 200 products from its stores. However, there hasn’t been specific reports on which products will be will be rolled back or when.
"We are examining each of our businesses in order to focus our investments on those businesses that will meaningfully contribute to revenue and profit growth, while licensing or exciting those that won't," Maw stated in the company’s first-quarter financial results discussion.
"This simplification effort increases our focus and reduces operational complexity in our stores." He added.
Starbucks Coffee Shop on a Christmas Holidays - Starbucks is an American Coffee Shop Chain, Founded in 1971.
Speaking of financial reports, the famed coffee company unfortunately missed the market estimates due to the results of the lukewarm sales recorded during the past holidays. This includes holiday merchandise aside from the existing offers. According to Maw, the sales of the products have rather been flat to “slightly negative for several years."
Also according to reports, Starbucks is one of the few companies to adapt the psychology of less is more in terms of Menu Sizes. Aside from the said coffee company, Target and Kohl’s have also announced plans to reduce their product line up.
More so, Starbucks will be closing its online store along with its Teavana stores which markets Tazo teas during the product cuts.
In other news, Starbucks has recently opened its first Reserve store in Seattle with products from its newly announced partner: the Italian Princi. The company partnered with Princi last summer and with this, the Reserve store will feature Princi bakeries and premium coffee. This is the first reserve store that opened as part of the 1,000 plan.
“Over forty years ago Starbucks set the standard for the third place experience and at the time it was unprecedented, giving our customers a place to connect with each other in new ways. Today marks another significant milestone as we have taken everything we have learned from our highly successful Roasteries, the relevancy of the third place and the overwhelming reception of freshly baked Princi food to an environment that will re-define customer connection and continue to serve as a halo to the rest of the business,” Starbucks executive chairman Howard Schultz told reports.
Shares of Starbucks Corporation recorded a 1.68% surge in its recent trades. This is an increase of 1.03 points from the previous trades.
The Coppock curve’s performance beyond the positive region would recommend a buy for the coffee giant. It has remained a strong bullish performance and has recently managed to surpass the negative region. While the stock is low on volatility, again, a buy would be recommended for it.
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