business news in context, analysis with attitude

Starbucks has opened its first standalone Princi Bakery, in Seattle, at 2118 Westlake Avenue in the fast-growing, Amazon-dominated South Lake Union section of the city.

According to the Seattle Times, “The Italian-style bakery … will feature breakfasts including baked eggs and pastries; pizzas, soups, salads and sandwiches at lunch; deserts and breads. Coffee will include a Starbucks blend designed for the bakeries, and espresso beverages. It will also serve cocktails, beer and wine — the latest effort in Starbucks’ ongoing quest to drive sales in the afternoons and evenings.”

Starbucks struck a licensing and investment deal with Milanese baker Rocco Princi in 2015, using Princi “as a food purveyor for the company’s new high-end retail formats, including its showpiece Roastery and Reserve stores.”

A Princi bakery can also be found in the new Starbucks Reserve store opened on the ground floor of the company’s headquarters, just south of Safeco Field. MNB took a look at the store here and here.

The Times story notes that “there are five stand-alone locations in Milan and one in London, predating the venture with Starbucks. The Seattle Princi will be followed by locations in Chicago and New York, set to open in the fall. Princi’s lineup will also be sold in Roasteries scheduled to open over the next 18 months in Milan, New York, Chicago and Tokyo.”
KC's View:
The Times also notes that the Princi deal “followed Starbucks’ decision in 2015 to close 23 locations of La Boulange, a bakery chain it acquired in 2013 for $100 million.”

In other words, we’ve seen this movie before.

I’m anxious to see the store - which, as it happens, is just .2 miles from Amazon Go - but I’m not persuaded that this is an investment and direction that will stand the test of time … especially since the guy who championed it, Howard Schultz, no longer is with the company. They’ll give it a serious shot, but if they don’t get traction or they think it is becoming a money pit, Starbucks will bail on this.

I hope it works, because I like big swings. I’m just not confident about how scalable the idea is.