Wired News - Coffee Chain Starbucks to Bid Adieu to Single-Use Plastic Straws Globally By 2020
LONDON, UK / ACCESSWIRE / July 11, 2018 / If you want access to our free research report on Starbucks Corp. (NASDAQ: SBUX), all you need to do is sign up now by clicking the following link www.active-investors.com/registration-sg/?symbol=SBUX as the Company's latest news hit the wire. On July 09, 2018, the Company announced the elimination of single-use plastic straws from across its stores globally. The Company plans to replace the plastic straws with a specially-designed recyclable straw-less lid, as well as straws made out of alternative materials. The decision will be implemented in a phased manner and, by 2020, the Company would have completely eliminated plastic straws from its stores globally. Register today and get access to over 1,000 Free Research Reports by joining our site below:
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The Plan
Starbucks plans to eliminate the use of single-use plastic straws across its 28,000 Company-operated and licensed stores. The plan to eliminate plastic straws will be implemented in a phased manner and is expected to be completed by FY20. The decision is expected to result in the elimination of over one billion plastic straws annually.
The Company plans to replace the plastic straws with straw-less lids or straws made out of alternative materials across all its locations globally. The Company has already designed, developed, and manufactured a new straw-less lid which will be used for serving all types of iced coffee, tea, and espresso beverages. This new straw-less lid will be introduced across 8,000 Starbucks locations in the US and Canada for serving select beverages like Starbucks Draft Nitro and Cold Foam. The Company is also planning to test these new straw-less lids in markets like China, Japan, Singapore, Thailand, and Vietnam by using it for its Nitro range of beverages on a trial basis. The Company also plans to offer straws made from alternative materials like paper or compostable plastic to its customers ordering Frappuccino® blended beverages or to those customers requesting a straw. The decision makes great sense given that the Company's cold beverages, which actually require the straws, now accounts for nearly 50% of its total sales, and is expected to grow even more in the future.
The Company plans to introduce the straw-less lid to its customers in Seattle and Vancouver initially and later will be rolled out across its stores in the US and Canada in FY19. This will be followed by the launch of the straw-less lid in select stores in European markets like France, the Netherlands, and the UK. The Company has already introduced a trial scheme of charging 5p on takeaway coffee cups in select London stores from February 2018, and offering its customers a 25p per cup discount to customers willing to help reduce, reuse, and recycle these cups by bringing a reusable cup or tumbler to its stores. Starbucks has plans to expand this trial to over 950 stores in the UK later in July 2018 to promote reusability. The Company plans to donate the money collected to environmental charity and behavior change experts, Hubbub. Starbucks has also allocated over $10 million to identify best alternatives for recyclable and compostable cups. The Company has taken the decision after noting the growing concern and impact of plastic straws on the environment, especially on the various species living in the ocean.
Commenting on the decision to eliminate single-use plastic straws, Kevin Johnson, President and Chief Executive Officer (CEO) of Starbucks, said:
"For our partners and customers, this is a significant milestone to achieve our global aspiration of sustainable coffee, served to our customers in more sustainable ways."
Lauding Starbucks' decision, Erin Simon, Director of Sustainability Research & Development and Material Science at World Wildlife Fund, US, added:
"Plastic straws that end up in our oceans have a devastating effect on species. As we partner with Starbucks in waste reduction initiatives such as Next Gen Consortium Cup Challenge and WWF's Cascading Materials Vision, we hope others will follow in their footsteps."
On the same note, Nicholas Mallos, Director of Ocean Conservancy's Trash Free Seas program, stated:
"Starbucks' decision to phase out single-use plastic straws is a shining example of the important role that Companies can play in stemming the tide of ocean plastic."
Industry Support for Plastic Straw Ban
Starbucks has been implementing steps to promote sustainability and the current decision is the Company's latest efforts in taking the trend forward. Increasing global awareness about the dangers of using plastics, government intervention including plastic bans, as well as the impact of plastics on ocean lives have led to many restaurants, cafes, and coffee across the world to banning plastic straws in their locations. In June 2018, fast food chain McDonald’s announced plans to replace plastic straws with environment-friendly paper straws across its restaurants in the UK and Ireland. Other US Companies to ban plastic straws include Bon Appetit Management, Alaska Airlines, Royal Caribbean Cruises, Ikea, and SeaWorld Entertainment.
Stock Performance Snapshot
July 10, 2018 - At Tuesday's closing bell, Starbucks' stock climbed 1.04%, ending the trading session at $50.42.
Volume traded for the day: 9.03 million shares.
After yesterday's close, Starbucks' market cap was at $69.28 billion.
Price to Earnings (P/E) ratio was at 16.01.
The stock has a dividend yield of 2.86%.
The stock is part of the Services sector, categorized under the Specialty Eateries industry. This sector was up 0.1% at the end of the session.
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