Starbucks 2007 Annual Report Download - page 4

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Company-operated Retail Stores
The Company’s retail goal is to become the leading retailer and brand of coffee in each of its target markets by
selling the finest quality coffee and related products and by providing each customer a unique Starbucks
Experience. The Starbucks Experience, or third place after home and work, is built upon superior customer
service as well as clean and well-maintained Company-operated retail stores that reflect the personalities of the
communities in which they operate, thereby building a high degree of customer loyalty. Starbucks strategy for
expanding its retail business is to increase its market share primarily by opening additional stores in existing
markets and opening stores in new markets where the opportunity exists to become the leading specialty coffee
retailer. In support of this strategy, Starbucks opened 1,342 new Company-operated stores during the fiscal year
ended September 30, 2007 (“fiscal 2007”). Starbucks Company-operated retail stores, including 11 Seattle’s Best
Coffee»stores and 4 Hear Music retail stores, accounted for 85% of total net revenues during fiscal 2007.
The following table summarizes total Company-operated retail store data for the periods indicated:
Sept 30, 2007 Oct 1, 2006 Sept 30, 2007 Oct 1, 2006
Net Stores Opened During the
Fiscal Year Ended(1) Stores Open as of
United States ........................ 1,065 810 6,793 5,728
International:
Canada ......................... 88 74 596 508
United Kingdom .................. 66 47 580 514
China(2) ........................ 42 17 141 99
Germany ........................ 36 24 104 68
Thailand ........................ 18 22 103 85
Australia ........................ 4 25 87 83
Singapore ....................... 8 5 45 37
Other ........................... 15 19 56 41
Total International(2) ................. 277 233 1,712 1,435
Total Company-operated ................ 1,342 1,043 8,505 7,163
(1) Store openings are reported net of closures.
(2) Store data has been adjusted for the acquisition of the Beijing operations by reclassifying historical information
from Licensed stores to Company-operated stores.
Starbucks retail stores are typically located in high-traffic, high-visibility locations. Because the Company can vary
the size and format, its stores are located in or near a variety of settings, including downtown and suburban retail
centers, office buildings and university campuses. While the Company selectively locates stores in shopping malls,
it focuses on locations that provide convenient access for both pedestrians and drivers. With the flexibility in store
size and format, the Company also locates retail stores in select rural and off-highway locations to serve a broader
array of customers outside major metropolitan markets and further expand brand awareness. To provide a greater
degree of access and convenience for nonpedestrian customers, the Company continues to expand development of
Drive Thru retail stores. At the end of fiscal 2007, the Company operated approximately 2,300 Drive Thru locations,
compared to approximately 1,600 at the end of fiscal 2006.
All Starbucks stores offer a choice of regular and decaffeinated coffee beverages, a broad selection of Italian-style
espresso beverages, cold blended beverages, iced shaken refreshment beverages, a selection of teas and distinctively
packaged roasted whole bean coffees. Starbucks stores also offer a selection of fresh pastries and other food items,
sodas, juices, bottled water, coffee-making equipment and accessories, a selection of compact discs and seasonal
novelty items. Each Starbucks store varies its product mix depending upon the size of the store and its location.
Larger stores carry a broad selection of the Company’s whole bean coffees in various sizes and types of packaging,
as well as an assortment of coffee and espresso-making equipment and accessories such as coffee grinders, coffee
filters, storage containers, travel tumblers and mugs. Smaller Starbucks stores and kiosks typically sell a full line of
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