Starbucks 2011 Annual Report Download - page 11

Starbucks total licensed stores by region and country as of October 2, 2011 are as follows:
Asia Pacific Europe/Middle East/Africa Americas
Japan ............... 935 Turkey ................ 153 US ................... 4,082
SouthKorea .......... 367 UK ................... 128 Mexico ................ 318
Taiwan .............. 249 UnitedArabEmirates ..... 94 Canada ................ 284
China ............... 218 Spain.................. 75 Other.................. 92
Philippines ........... 183 Kuwait ................ 67
Malaysia............. 121 SaudiArabia ............ 65
HongKong........... 117 Greece ................ 59
Indonesia ............ 109 Russia ................. 52
NewZealand ......... 35 Other.................. 169
Total ................ 2,334 Total .................. 862 Total .................. 4,776
In the US, 215 and 166 licensed stores were opened during 2011 and 2010, respectively, and 557 and 106 licensed
stores were closed during 2011 and 2010, respectively. The 557 licensed stores that were closed in the US during
fiscal 2011 include 475 Seattle’s Best Coffee locations in Borders Bookstores. Internationally, 455 and 335 licensed
stores were opened during 2011 and 2010, respectively, and 110 and 100 licensed stores were closed during 2011
and 2010, respectively.
Consumer Packaged Goods
Consumer packaged goods includes both domestic and international sales of packaged coffee and tea to grocery and
warehouse club stores. It also includes revenues from product sales to and licensing revenues from manufacturers
that produce and market Starbucks and Seattle’s Best Coffee branded products through licensing agreements.
Revenues from sales of packaged coffee and tea comprised 4% of total net revenues in fiscal 2011. In prior years
through the first several months of fiscal 2011, we sold a selection of Starbucks and Seattle’s Best Coffee branded
packaged coffees and Tazo®teas in grocery and warehouse club stores throughout the US and to grocery stores in
Canada, the UK and other European countries through a distribution arrangement with Kraft Foods Global, Inc.
Kraft managed the distribution, marketing, advertising and promotion of these products as a part of that
arrangement. During fiscal 2011, we successfully transitioned these businesses, including the marketing,
advertising, and promotion of these products, from our previous distribution arrangement with Kraft and began
selling these products directly to the grocery and warehouse club stores. We also sell packaged coffee and tea
directly to warehouse club stores in international markets.
Revenues from licensing our branded products accounted for 1% of total net revenues in fiscal 2011. We license the
rights to produce and market Starbucks and Seattle’s Best Coffee branded products through several partnerships
both domestically and internationally. We also sell ingredients to these licensees to manufacturer our branded
products. Significant licensing agreements include:
• The North American Coffee Partnership, a joint venture with the Pepsi-Cola Company in which Starbucks is
a 50% equity investor, manufactures and markets ready-to-drink beverages, including bottled Frappuccino®
beverages and Starbucks DoubleShot®espresso drink and Seattle’s Best Coffee®ready-to-drink espresso
beverages in the US and Canada;
• licensing agreements with Arla, Suntory, and Dong Suh Foods for the manufacturing, marketing and
distribution of Starbucks Discoveries®, a ready-to-drink chilled cup coffee beverage, in Europe, Japan and
South Korea, respectively;
• a licensing agreement with a partnership formed by Unilever and Pepsi-Cola Company for the
manufacturing, marketing and distribution of Starbucks super-premium Tazo®Tea beverages in the US; and
• a licensing agreement with Unilever for the manufacturing, marketing and distribution of Starbucks®super-
premium ice cream products in the US.
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