Starbucks Sends Salads to East Coast to Help Afternoon Sales
(Bloomberg) -- Starbucks Corp.’s bet on food just got a little meatier.
The company is expanding its new Mercato line of sandwiches and salads to some locations on the East Coast this week, bringing the nationwide total to about 1,300 stores. New York stores in Westchester, Queens, Long Island and Brooklyn will be among those carrying the new menu items, Starbucks said Tuesday.
“It has been a successful business driver in lunch,” Sandra Stark, senior vice president of global innovation, said in an email. “That’s why we’re thoughtfully expanding to certain markets on the East Coast, growing in existing markets, and continuing to evaluate future markets.”
The company says it will introduce Mercato in its Manhattan cafes at a future date, without specifying.
Starbucks is betting on the new lunch selections -- dubbed Mercato -- to bring in more afternoon customers. The grab-and-go fare, including a chicken-and-cauliflower-tabbouleh salad and almond-butter sandwich, is made daily in outside kitchens. Starbucks also has been experimenting with digital menu boards that highlight the food and snacks and change depending on the time of day.
The company is retrenching in the U.S. amid slower growth and more competition from regional java sellers. It’s closing about 150 company-owned stores next fiscal year in the U.S., mostly in dense urban areas. Earlier this year, Chief Executive Officer Kevin Johnson noted that sales in the post-lunch hours were weak.
The chain historically has struggled to get coffee lovers to buy food, which is about 22 percent of Starbucks’ domestic sales. The company said it’s on track to reach 25 percent by the end of fiscal 2021. All of the Mercato items are less than $10 before tax, and specific menu items may be different across locations, the company said.
Starbucks doesn’t plan to offer its line of grab-and-go options everywhere -- it’s also in Chicago, Seattle and California -- Stark said, noting that the company tries to buy “fresh ingredients, and that’s not feasible or economical everywhere.”
“That’s why it’s just one part of our strategy,” she said.
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