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Non-Tech : Starbucks (SBUX) -- Ignore unavailable to you. Want to Upgrade?

To: Joseph H. Leiti who wrote (902)	10/15/1999 2:01:00 PM
From: gpphantom	Read Replies (1) \| Respond to of 1506

(REUTERS) INTERVIEW-Starbucks<SBUX.O> CEO doubles global estimate INTERVIEW-Starbucks<SBUX.O> CEO doubles global estimate By James Ashton LONDON, Oct 15 (Reuters) - Starbucks Corp chief executive Howard Schultz on Friday doubled his long-term target for the high street coffee retailer, saying the chain could sustain at least 20,000 outlets worldwide. "I am convinced that the number (of Starbucks stores) that we have estimated over the years has been too low," he told Reuters in an interview. "I would suggest that we will exceed... more than 20,000 units of Starbucks stores on a worldwide basis." He declined to give a timescale for his estimation, up from his previously stated target of 10,000. Starbucks currently has 2,520 outlets worldwide, including close to 100 in Britain. "When I say that we are in the infant stages of our growth and development, I mean it," Schultz said "We haven't even begun to penetrate the worldwide market," he said. TRADITIONALLY TEA-DRINKING Starbucks acquired the 50-strong Seattle Coffee Co. chain in a stock swap worth around $83 million in April 1998 and set about rebranding the chain five months later to assume first place in the UK specialty coffee market, but has yet to kickstart its European roll-out. Schultz admitted the acquisition was a one-off for the company which prefers to grow organically, but had made entering the traditionally tea-drinking UK market a formality. "The primary growth vehicle for the company throughout Europe is going to be organic -- there are not a lot of acquisition opportunities." "I don't think there's going to be a country throughout Europe that we're not going to be in," he added. Spending in premium British coffee shops rose to nearly 48 million pounds in 1997 from 5.6 million in 1993, as consumers bought into the coffee bar as a "third place" between home and work. Market analyst Euromonitor forecasts that the world consumption of coffee will be worth about $42 billion in 2001, compared with $37 billion in 1997, and will represent about 70 percent of the global hot drinks market. "In the world today, most adults will drink two cups of coffee a day and most of it is pretty bad in terms of quality -- we have an enormous opportunity," Schultz said, restating plans to open 500 outlets each in Europe and Asia-Pacific by 2003. NO THREAT FROM TEA OR JUICE He said he saw no threat from the spate of bars specialising in teas, soups and fresh juices which have sprung up across southern England, and was unfazed by fast food giant McDonald's Corp. <MCD.N> March purchase of London coffee chain Aroma. "From where I'm sitting, I don't think McDonald's is going to use Aroma to get into the Starbucks coffee business -- it looks more like a food business to me," he said. The company's first UK strategic alliance -- a concession within J Sainsbury Plc's <SBRY.L> new store in Greenwich, south-east London -- would be the first of six with the supermarket retailer this year, Schultz said. He envisaged more tie-ups to emulate its links with bookstore Barnes & Noble and United Airlines in the United States. The company would bring its coffee ice-cream and bottled Frappuccino products to Europe when its core outlets were better established, but could not see Starbucks straying from its core competency of coffee, Schultz added. ((London Advertising Newsdesk, +44 171 542 2809, fax +44 171 542 2929, email adnewslon@reuters.com)) REUTERS * end of story *