Starbucks to Sell French Cookies on a Test Basis at 25 Stores - Analyst Blog
Michel & Augustin recently announced that coffee company, Starbucks Corporation SBUX entered into an agreement with the Paris-based bakery company, on Jun 19. Per the deal, Starbucks will sell Michel & Augustin cookies on a test basis at its 25 stores in Manhattan. If the tests are successful, Starbucks will extend the partnership to its stores in France and the UK this summer.
Michel & Augustin already sells its products at 160 stores and cafés in the U.S. Its partnership with Starbucks will further widen its presence and provide it with an opportunity to grow into a bigger company.
The deal comes less than a week after Starbucks announced its decision to shutter all the 23 La Boulange bakery cafés by Sep 2015. Instead, the coffee chain will expand sales of the La Boulange premium bakery items at its Starbucks outlets in San Francisco and across the U.S. and Canada.
Since its acquisition in 2012, San Francisco-based La Boulange branded bakery goods have boosted food sales at Starbucks stores. However, the separate La Boulange retail stores have not done so well.
Meanwhile, the company ended its partnership with Pascal Rigo, the French baker who founded La Boulange.
Starbucks is fast expanding its food offerings in the U.S. with the launch of premium bakery goods, breakfast and lunch sandwiches and salads to complement its drinks. Food contributes around 20% of the company’s U.S. revenues. Starbucks plans to double its U.S. food sales to more than $4 billion by 2019 through focus on breakfast, lunch, snacking and evening program. Moreover, the company plans to expand its lunch menu and offer locally relevant snacks around the world.
This Zacks Rank #2 (Buy) stock has healthy fundamentals — a strong global retail footprint, successful food/beverage innovations, best-in-class loyalty program and digital offerings, rapid growth in international markets and consistently impressive Channel Development segment (CPG) growth.
Other restaurateurs worth considering include BJ's Restaurants, Inc. BJRI, Zoe's Kitchen, Inc. ZOES and Dave & Buster's Entertainment, Inc. PLAY. While Zoe's Kitchen and Dave & Buster's Entertainment sport a Zacks Rank #1 (Strong Buy), BJ's Restaurants holds a Zacks Rank #2.
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