If you thought Starbucks (SBUX) was expensive already, think again.
The biggest coffee retailer has just opened its first Reserve Roastery and Tasting Room in Seattle. Designed to be more of a coffee mecca than coffee shop, the store features special “reserve” coffee and offers what Starbuck’s calls a “Willy Wonka experience” for customers.
And all this comes with a steep price: the cheapest cup is $3 dollars.
But is there really a demand for even-pricier coffee? Yahoo Finance Senior Columnist Michael Santoli doesn’t doubt it.
“They certainly have reason think so,” he says. “Remember, there was a time when people would ask, ‘Who would pay $2 for a cup of coffee?’ I think you have to segment this market more and Starbucks is figuring out that they can certainly in a limited way accommodate this.”
Yahoo Finance Editor in Chief Aaron Task agrees.
“Starbucks created the whole coffee culture in this country,” he points out. “But now they’re being eaten away at the high end by the Stump Town Coffee Roasters and other places where they have these specific beans. And Starbucks is saying we’re going to serve that community as well.”
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Starbucks plans to eventually open 100 of the new roastery shops around the world. Yahoo Finance’s Jeff Macke feels this plan falls right in line with Starbucks’ long running-strategy.
“They’re not creating a chain of coffee meccas,” he notes. “They’re rolling them out very slowly in the context of what they’ve done already, such as Starbucks After Dark and serving booze.”
To that point, Yahoo Finance Editor in Chief Aaron Task believes the company is very much focused on creating more menu items beyond the traditional tall, grande and vente.
“Food and alcohol, that’s the big opportunity for them,” he says. “At their analysts’ conference this week they were very bullish on food and alcohol sales.”
But coffee is still king, says Macke. And the move into even higher-end java is just another good idea by the company’s CEO.
“This is just Howard Schultz playing with his big, huge factory and he’s awesome at it-- he’s a great retailer,” he says.