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July 18th, 2008

Starbucks drops the axe — is your store next?

Posted by: Lisa Baertlein

starbucksstore2.jpgCalifornia, Florida and Texas — the states with the biggest populations and the most Starbucks outlets — are losing the most stores as the coffee chain slashes more than 600 stores in a bid to boost slumping U.S. results.

While big states are losing the most, few markets — even Starbucks’ hometown of Seattle — are immune.

The axe is coming down everywhere, from Manhattan’s cityscape and California’s beaches to the downtrodden Motor City and burghs in the U.S. heartland, according to a store closure list released by Starbucks.

Here’s a state-by-state list of closures:

Alabama 12
Arkansas 8
Arizona 1
California 88
Colorado 9
Connecticut 5
Washington, D.C. 1
Delaware 1
Florida 59
Georgia 13
Hawaii 5
Iowa 7
Idaho 2
Illinois 25
Indiana 23
Kansas 3
Kentucky 6
Louisiana 13
Massachusetts 7
Maryland 12
Maine 2
Michigan 18
Minnesota 27
Missouri 17
Mississippi 7
North Carolina 10
North Dakota 4
Nebraska 7
New Hampshire 1
New Jersey 5
New Mexico 4
Nevada 18
New York 39
Ohio 9
Oklahoma 15
Oregon 6
Pennsylvania 21
South Carolina 1
Tennessee 13
Texas 57
Utah 4
Virginia 5
Washington 19
Wisconsin 6
West Virginia 1

Are you losing your favorite Starbucks? And if so, where will you go to get your fix? 

(Photo: Reuters)

July 10th, 2008

Check Out Line: Summer sizzle, summer fizzle

Posted by: Lisa Baertlein

girlplay2.jpg Check out how discounts, rebate checks and sweltering summer weather are helping some retailers thrive in the down economy.

Wal-Mart posted June sales that topped expectations and boosted its second-quarter earnings forecast after rebate check-wielding shoppers filled their carts with food, medicine and flat-screen TVs.

Discounter Family Dollar Stores posted a better-than-expected 8 percent gain in sales at stores open at least a year, boosted by government tax rebates.

Off-price retailers TJX Cos, parent of T.J. Maxx and Marshalls, and Ross Stores Inc reported June sales that topped estimates and raised quarterly profit forecasts after warm weather boosted demand for summer clothing.

But the news is not all good.

Upscale department store Nordstrom Inc said June sales tumbled almost 19 percent after it shifted the date of its half-yearly sale from June to May.

U.S. retailers avoid June Swoon; tax rebates help

Limited’s June same-store sales fall 9 percent

Gap June same-store sales down less than expected

Target posts small June same-store sales rise

(Photo: Reuters)

June 17th, 2008

Check Out Line: Inflation crimps consumer companies

Posted by: Lisa Baertlein

cocoaBy Ben Klayman

Check out how high gas and commodity costs are crimping Hershey and Best Buy.

Chocolate maker Hershey cut its long-term earnings growth target and said it would boost advertising as it moves to reverse falling profits.

However, the largest U.S. chocolate company, which is meeting with analysts, said the pressures it faces — soaring prices for cocoa , energy and other commodities — remain the same.

“We expect 2009 to be another trying year for us with respect to input costs,” Chief Executive David West said.

The price of oil has surged to $133 a barrel and that has pushed up costs across all industries.

The government said rising energy prices sent producer prices – a gauge of costs at the farm and factory gate — up a bigger-than-expected 1.4 percent in May. Housing starts fell in May to their lowest level in more than 17 years as that industry grapples with the subprime mortgage meltdown.

Meanwhile, consumer electronics retailer Best Buy reported a lower, but better-than-expected quarterly profit thanks to market share gains in TVs, computers and video games.

Like all retailers, Best Buy has faced slowing consumer spending due to rising gasoline and food prices prices, as well as the U.S. housing slump.

Also in the basket:

Reuters Consumer and Retail Summit coverage

(Photo: REUTERS/Susana Gonzalez)

June 11th, 2008

Tomatoes got you scared? Check out these Web sites

Posted by: Lisa Baertlein

Food safety officials in the United States are still searching for the cause of a Salmonella outbreak that has sickened 167 people in 17 states and is believed to be linked to raw round, plum and Roma tomatoes. 

If you want to see whether your state has reported a case, the Centers for Disease Control and Prevention has a site that shows the state-by-state breakdown.

Restaurants and grocery stores have dropped tomatoes like hot potatoes, and many consumers are avoiding them until they get an all-clear from the U.S. Food and Drug Administration.

Many people don’t know that the FDA has published a list of states and countries whose tomatoes are not linked to the outbreak.

FDA also has a site with tips on safe food handling techniques.

June 5th, 2008

Rebate checks fail to lift all retailers

Posted by: Lisa Baertlein

Check Out where consumers did and did not spend their government rebate checks.

The “economic stimulus” checks appeared to have helped retailers to better than expected sales in May, but discounters seemed to get the lion’s share of benefits as consumers bypassed niceties in favor of necessities like gas and food.

shoppersDiscounter Wal-Mart posted its strongest monthly sales performance since March 2007 and shoppers cashed $350 million worth of tax rebate checks at its stores.

Club store Costco posted better-than-expected May sales, boosted by food, gas and the weak dollar. BJ’s Wholesale Club’s sales were also higher.

While stores catering to teens and children also got their share of May spending — sales at Children’s Place and Buckle  topped Wall Street targets — other sectors of the retail sector struggled.

High-end department store Nordstrom had better-than-expected May sales — but that was largely because it held a major sale a month earlier than last year. Rival Saks’ sales were worse than expected. 

Sales at Limited Brands, the owner of underwear seller Victoria’s Secret, were off slightly more than anticipated and Gap’s monthly sales tumbled, hurt by weakness at Banana Republic, value-priced Old Navy and its namesake stores.
    
Also in the basket: 
    
Wall St. rises, spurred by retailers, data     
    
Home Depot sees weak same-store sales in second quarter
     
Target May same-store sales fall, missing view
     
TJX May same-store sales rise 2 percent
    
Family Dollar May same-store sales up 1.8 percent 
     
(Photo: Reuters)

June 4th, 2008

U.S. shoppers ready to ban the plastic bag

Posted by: Lisa Baertlein

plasticbag2.JPGAs California goes, so goes the nation — or at least that appears to be the case when we’re talking about San Francisco and the increasingly out-of-favor plastic shopping bag.
 
San Francisco became the first and only U.S. city to ban the bags in April 2008. Now it seems that the rest of the country is also ready to outlaw the offending carry-alls, which environmentalists say endanger wildlife and can take up to 1,000 years to decompose.
 
More than half, 54 percent, of Americans believe that plastic, non-compostable shopping bags should be banned, according Deloitte’s Retail “Green” Survey.  
 
rtx5dc2.jpgThat survey of 1,080 Americans, also found that nearly one-third say they take reusable shopping bags to food stores. 

Scores of other countries from Bangladesh to China have already banned the bags.

(Photos: Reuters) 

May 22nd, 2008

Check Out Line: McDonald’s finally makes its move

Posted by: Lisa Baertlein

mcdfries.JPGCheck out McDonald’s Corp’s long-awaited switch to trans fat-free cooking oil in the United States and Canada.

Jim Skinner, CEO at the Golden Arches, said the world’s largest hamburger chain finished dumping the oil with artery-clogging trans fats during the last few months. Speaking to investors at the company’s annual meeting, he also promised that pies and other baked goods would also be trans fat-free by year end. 

McDonald’s was among the first fast-food purveyor to vow to stop using trans fats, but it lagged the competition when it came to putting its money where its mouth is.

The company had its reasons. It said it was insuring a consistent taste for its french fries and looking for a supplier that could deliver enough trans fat-free oil to meet its needs.

Meanwhile, No. 3 hamburger chain Wendy’s was the first fast-food seller to swap to trans fat-free cooking oil in 2006. Yum Brands Inc’s U.S. KFC and Taco Bell chains completed their switch last year.

Burger King, the No. 2 hamburger chain, has promised to dump trans fat-containing frying oil by the end of this year. Until that happens, you can check out its nutritional charts to see how much trans fat it is serving up with your Whopper and fries.

For all the fuss made over the trans fat issue, you would have expected attendees of McDonald’s annual meeting to let up a cheer. Not so. Individual investors lodged new demands and divided into two camps: doggie happy meals vs.  kitty happy meals.
 

Also in the basket:

McDonald’s absorbs some costs to keep consumers

Hormel quarterly profit up 14 percent; shares fall

Children’s Place posts higher quarterly profit 

Ann Taylor outlook disappoints; shares fall
 

May 16th, 2008

Consumer Reports mellows on Starbucks

Posted by: Lisa Baertlein

Pike Place cupFirst it was too bitter, now it’s too mild.

Will Starbucks ever get it just right with the coffee testers at Consumer Reports?

In March 2007, the magazine blasted Starbucks’ drip java for being too burnt and bitter, and said fast-food vendor McDonald’s had a superior brew.

In April this year, Starbucks rolled out Pike Place Roast, its new everyday brew, saying it had a “smooth, welcoming taste.”

In its latest missive, Consumer Reports  took a decidedly more tepid stance on Starbucks’ new joe. 

The magazine’s testers found Pike Place to be “a smooth cup of coffee with some bitterness, but not particularly complex.” Because the flavor is so mild, the tasters said,  adding cream, milk or sweeteners might overwhelm the coffee.

Do you agree with the Consumer Reports’ testers?

(Photo: Reuters)

February 28th, 2008

Starbucks dustup or Much Ado about Nothing?

Posted by: Lisa Baertlein

espresso.jpg    Starbucks’ decision to close its stores for a few hours of coffee-brewing training on Tuesday got a double shot of media airtime — when it was first announced and the day of the closure — but has it raised the bar on coffee or customer service at the ubiquitous coffee chain’s outlets?
    This reporter conducted a highly unscientific poll of five customers, and the exchanges, at a Starbucks in Los Angeles’ downtown, went something like this:
    Reporter: “Have you noticed a difference in the quality of your coffee or the customer service today?”
    Startled customer: (takes sip of coffee, pauses to ponder flavor) “No.”
    Starbucks called the event a success: “We believe that the investment made in this training will have a significant impact on our customers’ experience.”
    The fledgling IWW Starbucks Workers Union, however, is in a froth over the training effort — which is part of a plan by returned Chief Executive Howard Schultz to reignite Starbucks’ flagging U.S. growth.
    The union, which calls itself a “modest-sized group,” called Tuesday’s three-hour training session a “public relations event directed at consumers rather than a bona fide attempt to improve drink quality or customer service.”
    Cole Dorsey, 27, a member of the union and a barista at a Starbucks in Grand Rapids, Michigan, called the training “a ploy”.
    “The majority of the people who got that training won’t be here next year,” he said.
    A Starbucks spokeswoman said the Seattle company heard from employees who appreciated having a chance to “focus on espresso excellence” and to refresh their skills.
    “Unfortunately, the opinions in the IWW press release are those of a small group of people with an outside agenda aimed at promoting themselves and their interests, rather than improving our customers’ and partners’ Starbucks experience,” she said. 
 

November 24th, 2006

Sony’s PS3 draws men to malls

Posted by: Lisa Baertlein

ps3mall.jpgSony’s new PlayStation 3 video game console is bringing more married couples together this holiday shopping season — Just not for the reasons one would expect.
 
“We are interviewing shoppers and a lot of husbands said they will shop with wives because they are concerned about crime and violence surrounding the PlayStation 3,” Britt Beemer, founder of America’s Research Group, told Reuters.
 
The PS3 debuted on Nov. 17 to big U.S. crowds eager to be among the first to put their hands on the long-awaited and very limited supplies of new machines from the world’s leading console maker. The launch was marred by violence when bandits shot a man waiting in line at a Connecticut Wal-Mart after he refused to hand over his cash.

Following the shooting, Sony issued a statement calling the attack an isolated incident.

“There are two or three times more men out today,” said Beemer, whose firm specializes in consumer behavior marketing.

(Reporting by Aarthi Sivaraman; Photo by Reuters)