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Starbucks to deliver food in US and expand stores in China

The coffee conglomerate will expand to deliver food to customers.

IG Analyst

Publication date : 2018-12-13T22:05:00+0000

Source: Bloomberg

Starbucks has partnered with Uber Eats to deliver food and drinks to customers. In addition to teaming up with the delivery app, the corporation will build additional stores in China.

Starbucks gets into food delivery boom

Food delivery services like Uber Eats, Doordash, and Postmates have been very popular, and Starbucks wants to expand into that profitable division. Though the corporation is the most successful coffee seller in the world, more specialty shops are cutting into the company’s profits with more unique flavors and fresher food offerings. In addition to the competition from other businesses, the company’s foot traffic has lessened, so fewer customers are staying in the stores. To solve the problem, Starbucks chief executive officer (CEO), Roz Brewer, is looking into food and drink delivery.

‘In locations where drive-thru isn't feasible, we are testing platforms like delivery,' said Brewer.

Starbucks is partnering with Uber Eats to deliver food from a quarter of its 14,000 US locations. The corporation tested the program in September and is expected to launch in 2019.

Starbucks expands into China

In addition to the expansion into food delivery with Uber Eats in the US, the coffee giant is opening more stores in China. The corporation already has a delivery program in the Asian nation and wants to amplify its presence in the country. Starbucks wants to open 6000 stores in 230 cities in the nation by 2022. While sales have been stagnant in the US, there has been a growth incustomers across China. Starbucks’ stock briefly rose, but is now down after announcing that it will offer the food delivery service.

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