Starbucks 2014 Annual Report Download - page 6

2 Starbucks Corporation 2014 Form 10-K
PART I
Item 1. Business
General
Starbucks is the premier roaster, marketer and retailer of specialty coffee in the world, operating in 65 countries. Formed in
1985, Starbucks Corporation’s common stock trades on the NASDAQ Global Select Market ("NASDAQ") under the symbol
"SBUX." We purchase and roast high-quality coffees that we sell, along with handcrafted coffee, tea and other beverages and a
variety of fresh food items, through company-operated stores. We also sell a variety of coffee and tea products and license our
trademarks through other channels such as licensed stores, grocery and national foodservice accounts. In addition to our
flagship Starbucks Coffee brand, we also sell goods and services under the following brands: Teavana, Tazo, Seattle’s Best
Coffee, Evolution Fresh, La Boulange and Ethos.
Our objective is to maintain Starbucks standing as one of the most recognized and respected brands in the world. To achieve
this, we are continuing the disciplined expansion of our global store base, adding stores in both existing, developed markets
such as the US, and in newer, higher growth markets such as China, as well as optimizing the mix of company-operated and
licensed stores in each market. In addition, by leveraging the experience gained through our traditional store model, we
continue to offer consumers new coffee and other products in a variety of forms, across new categories, and through diverse
channels. We also believe our Starbucks Global Responsibility strategy, commitments related to ethically sourcing high-quality
coffee and contributing positively to the communities we do business in, and being an employer of choice are contributors to
our objective.
In this Annual Report on Form 10-K ("10-K" or "Report") for the fiscal year ended September 28, 2014 ("fiscal 2014"),
Starbucks Corporation (together with its subsidiaries) is referred to as "Starbucks," the "Company," "we," "us" or "our."
Segment Financial Information
We have four reportable operating segments: 1) Americas, which is inclusive of the US, Canada, and Latin America; 2) Europe,
Middle East, and Africa ("EMEA"); 3) China/Asia Pacific ("CAP") and 4) Channel Development. We also have several non-
reportable operating segments, including Teavana, Seattle's Best Coffee, Evolution Fresh, and our Digital Ventures business,
which are combined and referred to as All Other Segments. Revenues from our reportable segments and All Other Segments as
a percentage of total net revenues for fiscal 2014 were as follows: Americas (73%), EMEA (8%), CAP (7%), Channel
Development (9%) and All Other Segments (3%).
Our Americas, EMEA, and CAP segments include both company-operated and licensed stores. Our Americas segment is our
most mature business and has achieved significant scale. Certain markets within our EMEA and CAP operations are still in the
early stages of development and require a more extensive support organization, relative to their current levels of revenue and
operating income, than our Americas operations. In certain markets within EMEA and CAP, occupancy costs and store
operating expenses can be higher than in the Americas segment due to higher rents for prime store locations or costs of
compliance with country-specific regulatory requirements. The Americas and EMEA segments also include certain foodservice
accounts, primarily in Canada and the UK. Our Americas segment also includes our La Boulange® retail stores.
Our Channel Development segment includes roasted whole bean and ground coffees, premium Tazo® teas, Starbucks- and
Tazo-branded single-serve products, a variety of ready-to-drink beverages, such as Frappuccino® beverages, Starbucks
Doubleshot® espresso drinks, Starbucks Refreshers® beverages, and other branded products sold worldwide through channels
such as grocery stores, warehouse clubs, specialty retailers, convenience stores, and US foodservice accounts.
Starbucks segment information is included in Note 16, Segment Reporting, to the consolidated financial statements included in
Item 8 of Part II of this 10-K.