Friday, June 3, 2016

Starbucks Grocerant Ready-2-Eat and Ready-2-Drink Drives Growth

Starbucks Howard Schultz is the preeminent food merchant of our time according to Foodservice Solutions® Grocerant Guru®. Without doubt Starbucks coffee is hot, the prepared food is driving sales, and tea is selling both Hot and Cold.  

Schultz is a food merchant first and foremost,with the ability to not only understand points of distribution but the ability to drive innovation in product while creating new points of distribution for all his products.
This week Schultz announced that Anheuser-Busch and Starbucks “are working together to produce, bottle, distribute, and market the first Teavana Ready-to-Drink (RTD) tea in the U.S., with an anticipated product launch in the first half of 2017. “

Grocerant niche Ready-2-Drink (R2D) premium tea is the fastest-growing segment in the R2D tea category, which grew at 16 percent CAGR over the past five years and generates $1.1 billion in sales. Together, Starbucks and Anheuser-Busch will bring their complementary strengths to bear to capitalize on the significant growth opportunity. Starbucks will contribute Teavana’s tea expertise, industry-leading retail activation, and consumer engagement capabilities, and Anheuser-Busch will lead production, bottling, and distribution to retailers nationwide in partnership with its long-standing and well-established network of wholesalers.”

So just what does that mean?  It means that since U.S. Starbucks locations have sold more than $1 billion of handcrafted Teavana tea beverages, representing 11 percent growth in year-over-year sales. That is will not be long until that $1 billion dollar product line can be found at C-stores, Drug stores, Grocery stores and even though it’s a non-alcohol product you will be able to find it a select liquor stores as well.

Howard Schultz, chairman and chief executive officer at Starbucks stated  “Tea has been an important part of Starbucks heritage since we opened our doors as Starbucks Coffee, Tea and Spices in the Pike Place Market in 1971,” … “When we acquired Teavana in 2012, we saw a unique opportunity to do for tea what Starbucks has done for coffee and expand the Teavana brand across many customer experiences and products.”

“Starbucks’ excels at brand building and leadership in premium tea, combined with Anheuser-Bush’s world-class production capabilities and strong U.S. distribution footprint, will create a platform for strong incremental growth. 

Success does leave clues and once again Starbucks is leading by example.  Have you identified, quantified, or qualified a new niche, product line, or avenue of distribution lately?  Foodservice Solutions® can help. Visit or Contact:

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