Starbucks to sell beer and wine in bid to boost US footfall

Starbucks, aiming to give cooling US traffic a jolt, has announced it will add beer, wine, and evening snacks to thousands of domestic cafes, widen lunch offerings and roll out mobile ordering.

Such efforts are part of the world’s biggest coffee chain’s plan to broaden its appeal as a destination with consumers who are spending more time shopping online rather than in malls and main street stores.

It is not clear at this stage if the chain will seek licenses to sell alcohol in other parts of the world.

The company, which is hosting its biennial investor meeting in Seattle, said it would lay out its five-year plans to double US food revenue to over $4 billion by expanding food choices, particularly during lunch hours.

Starbucks plans to reap about $1 billion in new sales from the addition of evening menus, including beer, wine and food, at nearly 3,000 of its 11,900 cafes in the United States.

The company also will detail the launch of a new mobile ordering and payment system that it says will make getting a coffee fix even more convenient. That same technology will underpin deliveries in select US markets next year. Additionally, in coming months, it will debut express stores, coffee trucks and upscale “reserve” shops, which will offer premium specialized coffee sourced from small farms.

Starbucks' US-dominated Americas unit had a traffic gain of 1 per cent in the latest quarter, versus the 5 percent jump in the year-earlier period. An increase in sales of food, such as croissants and breakfast sandwiches, has helped offset slowing traffic in the last three quarters.

Chief Executive Howard Schultz in January warned that a "seismic" shift to online shopping was taking a bite out of traffic to US brick-and-mortar stores. That, executives said, contributed to a moderate slowdown in traffic in December 2013. Traffic softened earlier this year than last and the weakness is expected to continue through the holiday season, said Steven Barr, who leads PwC's US retail and consumer practice.

The chain, which has 21,000 shops worldwide serving 70 million customers weekly, forecast fiscal 2019 revenue of nearly $30 billion, up from $16 billion in 2014.