Starbucks Confident In K-Cups Sales For Green Mountain Brewers

NEW YORK -(Dow Jones)- Starbucks Corp. (SBUX) says it's seeing strong sales of its K-cup portion packs for Keurig single-serve coffee brewers, even though Keurig's parent company, Green Mountain Coffee Roasters (GMCR), has seen an unexpected deceleration of sales growth lately. Starbucks Chief Executive Officer Howard Schultz sent an e-mail to employees Thursday, reassuring them that "Starbucks K-Cups continue to see robust gains," and that "Starbucks' relationship with Green Mountain remains as strong as ever." The e-mail came as Green Mountain's shares tanked 48% Thursday after it reported its latest quarterly earnings. Green Mountain's lower-than-expected sales and excess inventory weighed on its profit last quarter and deflated investor confidence in the long-term potential of the company.

Schultz said that while he can't comment on Green Mountain's performance, the single-serve coffee market remains a major focus for Starbucks. It will even begin selling two new varieties of K-cups in grocery stores "in the coming months," Schultz said in the e-mail. Seattle-based Starbucks has shipped more than 230 million K-Cups since it began selling the pods at supermarkets and retailers last year. The company also plans to begin selling its own single-serve espresso brewer and pods this fall, and continues to see strong sales of its Via Readybrew single-cup line. It's possible that the entrance of Starbucks as a new premium brand of K-cups is stealing sales from other K-cup providers.

I gained a bunch of weight and my lungs were constantly irritated. The cause? Hot green tea lattes sweetened with melon syrup at Starbucks. I switched to the black drip coffee for a few weeks. My lungs healed and I dropped 10 lbs. The weight continued to come off for a few months.

My sister gave me a Starbucks card for my birthday last August. I haven't used it yet. In fact, I've only been inside Starbucks about 4 times since last August. I have 4 cards with money sitting on them. I don't do well with milk and the soy alternatives don't taste very good. The teas are boring. What to do? Starbucks makes their money selling sweetened flavored milk that sometimes includes coffee. It's not anything I want to drink. The casein rips up my intestines. The sugar makes me fat. Who needs that? The plain coffee does taste acidic and nasty.

I'm in the K Cup distribution business...

GMCR dropping stock price is a direct result of their patent on the K-cup and the Keurig machine is about to expire soon....GMCR owns all K Cup coffee brands and coffee makers...

There are at least two major corporations about to jump into K cup business....feet first which means competition and lower prices...GMCR total hold on the market is about to be broken...

Being in the business, I can tell you how happy it makes me this is going to happen to a biggest bunch of ass hats...

Species8472 wrote:

"I roast my own beans at home."

Me, too. In fact, I'm roasting a couple pounds of Columbia "Dos Payasos de Tolima" right now as I type.

Sweet Maria's are definitely the best. I've bought my green coffee from them for years, as well as my Hot Top roaster. Wouldn't deal with anyone else. Tom's a little self-righteous sometimes in his postings, but I guess he has a right to be as he knows what he's talking about.

Anyone who buys one of these single cup machines is a chump, or at least likes to waste huge coin on crappy coffee. Roasting your own can get as low as $5.00 a pound for real quality coffee, even less if you order in heavy bulk. You can't hardly buy Maxwell House for that much, let alone $14.00 for 24 measly cups with those single cup machines. Roasting takes less than 15 minutes and aside from watching the machine and pushing a couple of buttons, not very complicated. A few minutes a week will get you a week's worth of roasted coffee.

I've wasted a lot of money in my time on stupid hobbies, but this is one I'm VERY happy I've moved into. I've even put together a coffee kit to take my roasted beans with me when I travel for business. As bad as these single cup machines are, the hotel room machines are disgusting.

From "Jihad Watch.com" published after Caribou went public:

http://www.jihadwatch.org/2005/10/caribou-coffee-sharia.html

"When my Foolish colleague W.D. Crotty recently gave investors a good look at the newly public Caribou Coffee (Nasdaq: CBOU - News), there was one interesting detail he omitted. And this detail, if misunderstood by the investing public, could cause some rather significant problems in the future. After the deal is done, Caribou Coffee will still be controlled by its primary investor -- Arcapita Bank, formerly known as First Islamic Investment Bank. Those who run Arcapita (and its subsidiaries) do so according to Islamic principles collectively known as shari'ah (or shariah or sharia). Shari'ah encompasses a wide range of rules and customs, including some that directly impact the running of a business. Specifically, shari'ah influences how the company borrows or lends money, how it may engage in derivative transactions, and what sorts of products it may sell. On the subject of borrowing and lending, shari'ah can be a bit confusing, and there is disagreement within the Islamic community as to what constitutes acceptable or unacceptable transactions. While Caribou has borrowed money in the past, investors should realize that negotiating future borrowings that comply with shari'ah could take a little time and might impair the company's access to quick sources of capital.

Other areas are decidedly clearer. Caribou will not engage in derivative transactions, which could impair the company's ability to hedge future coffee prices. Elsewhere, the company will not be engaging in activities pertaining to alcohol, gambling, pornography, or pork. I don't see how any of the first three will have any bearing on running a coffee shop to compete with the likes of Starbucks (Nasdaq: SBUX - News) or Peet's Coffee (Nasdaq: PEET - News), but I suppose it's conceptually possible that not being able to sell pork products (like a ham sandwich or bacon wrap) could hurt Caribou's standing with some customers.

The bigger risk in my view, though, is ignorance. Islam is not exactly well understood in this country, and there are a lot of people who go into knee-jerk reactions when they hear the word. Accordingly, companies in the U.S. like Caribou and its sister company Church's Chicken that run themselves according to shari'ah may be the unfair targets of malice, bias, and flat-out ignorance from time to time."

Make your own choices, I will continue to roast my own.

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