Seeking Alpha

Starbucks to face some new store challengers in the U.S.

  • Though Starbucks (NASDAQ:SBUX) grew its U.S. comparable-store sales by an impressive 7% in FQ3 to top peers, and has swatted away challengers before, the company could see some new competition in 2H and into 2015.
  • Peet's Coffee & Tea plans to open 16 locations in Chicago, several of which sit in close proximity to Starbucks (SBUX) outlets.
  • Peet's is owned by coffee brand giant Joh. A. Benckiser which directly challenges Starbucks in Europe, but has been more conservative to take on the Seattle giant in the U.S.
  • The development in the Windy City follows a trend in NYC of more indie coffee shops opening aside Starbucks stores. A coffee app called Cups has also launched over the summer to some positive early results.
  • What to watch: The westward march of Dunkin' Brands (NASDAQ:DNKN) and the potential expansion of Tim Hortons (NYSE:THI) could also be factors in the U.S. coffee market, although many analysts think the power of the SBUX brand and the continued strong demand for coffee will leave multi-channel Starbucks in solid shape.
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Comments (13)
  • hiram195
    , contributor
    Comments (2) | Send Message
     
    Starbucks is far superior to all the others
    1 Sep 2014, 03:38 PM Reply Like
  • WisPokerGuy
    , contributor
    Comments (1009) | Send Message
     
    I agree... Bring them on. I've never seen a product that people were more loyal too then their Starbucks daily coffee fix. Plus, they have one of the smartest CEO's out there. I'm long and plan to stay that way.
    1 Sep 2014, 10:48 PM Reply Like
  • BAHAMAS1
    , contributor
    Comments (2836) | Send Message
     
    And will stay that way !
    1 Sep 2014, 03:47 PM Reply Like
  • Bbloomlu
    , contributor
    Comments (273) | Send Message
     
    Hurry sell your SBUX the peets are coming the peets are coming and the sky is falling, curtesy chicken little
    1 Sep 2014, 03:56 PM Reply Like
  • Cliff Hilton
    , contributor
    Comments (2005) | Send Message
     
    Starbucks has benefited from being the biggest not the best. If you think Starbucks is the best, you should really vacation somewhere else besides
    your backyard.

     

    The stock is here to stay for the foreseeable future. Good investment...
    1 Sep 2014, 09:40 PM Reply Like
  • King Rat
    , contributor
    Comments (879) | Send Message
     
    Agreed and agreed. MCD makes terrible burgers and has poor quality control, and they are going nowhere fast. Of course, when you're on top, going nowhere is a good thing. Likewise SBUX coffee is terrible to many coffee fans but the company looks poised to stay on top for a long time.

     

    At work I've gotten Starbucks and made my own blend (Asian brand not available in the US) and done a taste test that Starbucks won unanimously. The next day I tried again but poured Starbucks into mugs and my coffee into the Starbucks containers. Again people voted unanimously for the coffee in the Starbucks containers as tasting better, not realizing I had switched them.

     

    To that end, I have to say, people are brainwashed into thinking Starbucks tastes better. Either that or their containers contain addictive chemicals that leech into the coffee. If neither of those then maybe it's the cup with hippie mermaids that people like.
    Whatever it is, as long as enough people think that Starbucks is so superior to anything else then no matter how bad Starbucks really is they will keep going to Starbucks.

     

    I am not long SBUX but perhaps should be.
    2 Sep 2014, 01:14 AM Reply Like
  • Daniel Reprieto
    , contributor
    Comments (3) | Send Message
     
    Who the heck is Peet's Coffee & Tea?
    1 Sep 2014, 10:40 PM Reply Like
  • Dr Joseph Haluska
    , contributor
    Comments (490) | Send Message
     
    It seems to me that people go to Starbucks BECAUSE it's Starbucks....nothing else compares.....I'm waiting to hear about people tattooing the logo, like Harley...
    I own SBUX because of Howard Schultz.
    2 Sep 2014, 12:08 AM Reply Like
  • civ-e
    , contributor
    Comments (417) | Send Message
     
    starbucks may or may not have the best coffee, but it tastes good enough and among the things going for it is that it's consistent -- i can go to any one of the thousands of stores and expect the same taste/quality -- and it also serves a larger portion than i get elsewhere. sure i can go to the local coffee shop where they may use some special rare beans but that store can't be everywhere and they tend to serve a small cup which is not enough to satisfy me.
    2 Sep 2014, 01:26 AM Reply Like
  • NY2LA 1
    , contributor
    Comments (610) | Send Message
     
    Have fun with all the bawling babies changing their diapers next to you and your latte. Enjoy! Starbucks Daycare.
    2 Sep 2014, 07:39 AM Reply Like
  • Cliff in Cal
    , contributor
    Comments (11) | Send Message
     
    does anyone know if it is still possible to invest in PEETS coffee? it was sold few years back, but can we invest?
    17 Jan, 04:06 PM Reply Like
  • Shaduc
    , contributor
    Comments (1838) | Send Message
     
    Peets was bought by a German firm.
    18 Jan, 06:16 AM Reply Like
  • Cliff in Cal
    , contributor
    Comments (11) | Send Message
     
    that sucks, i love their coffee and wanted to own shares
    19 Jan, 01:00 AM Reply Like
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