Starbucks Reimagined...Maybe, Chips Rebound, Brookfield learns an emerging markets lesson
Starbucks Reimagined…Maybe
At a dinner party several years ago I was seated next to a successful restauranteur. She made the simply claim that every restaurant sells the same thing. It is only a question of how one chooses to package sugar, salt and fat
Going out to eat is pleasurable. There is the atmosphere, the happy result of having hunger sated, and the fact you are served instead of having to cook at home. There is also the less discussed experience that you do not know exactly what is going into the food.
Restaurants typically use more salt than many people would use at home. That also helps with selling alcohol. They also use more fats in the cooking process and many dishes are fried even if not deep fried.
A company like McDonalds sells fat and salt in large quantities as well as sugar as side hustle.
Starbucks is known as a coffee shop but most of what is on the menu is sugar.
It helps to remember that Starbucks is a fast food restaurant. That’s the best way to think about the services it offers and the way it seeks to make money.
There was a rumour yesterday that it is open to selling it Chinese operation. Today, the company denied the rumour.
It is certainly an interesting time for Starbucks. The share is at the same level today as at the peak in 2019.
Selling the Chinese business would provide a one-time boost but would give up on any potential to grow. The company today stated they are looking for growth opportunities in the country.
They also decided to simplify how they charge for additional measures of syrup. For the vast majority of what they sell, the number of pumps of syrup is the differentiation between customers.
