Latest / Omni Talk Retail / Starbucks Wants 10,000 More Stores. Is the Third Place Strategy at Risk? | Fast Five Shorts

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Starbucks Wants 10,000 More Stores. Is the Third Place Strategy at Risk? | Fast Five Shorts · Omni Talk Retail

• 0:00
  According
• 0:00
  to
• 0:00
  the
• 0:00
  nation's
• 0:01
  Restaurant
• 0:02
  News,
• 0:02
  the
• 0:02
  NRN
• 0:03
  Starbucks
• 0:04
  believes
• 0:04
  it
• 0:04
  can
• 0:05
  get
• 0:05
  bigger
• 0:06
  by
• 0:06
  getting
• 0:07
  smaller.
• 0:08
  Specifically,
• 0:08
  the
• 0:08
  coffee
• 0:09
  shop
• 0:09
  giant
• 0:09
  wants
• 0:09
  5,000
• 0:10
  more
• 0:10
  locations
• 0:11
  in
• 0:11
  the
• 0:11
  US
• 0:11
  and
• 0:12
  believes
• 0:12
  that
• 0:12
  it
• 0:12
  knows
• 0:12
  the
• 0:13
  markets
• 0:13
  where
• 0:13
  it
• 0:13
  can
• 0:13
  open
• 0:14
  those
• 0:14
  units.
• 0:14
  But
• 0:15
  the
• 0:15
  locations
• 0:15
  it
• 0:16
  plans
• 0:16
  to
• 0:16
  open
• 0:16
  will
• 0:17
  be
• 0:17
  smaller
• 0:17
  than
• 0:17
  those
• 0:18
  it
• 0:18
  has
• 0:18
  historically
• 0:19
  opened.
• 0:19
  At
• 0:20
  the
• 0:20
  company's
• 0:20
  Investor
• 0:20
  day
• 0:21
  presentation
• 0:21
  earlier
• 0:21
  this
• 0:22
  year,
• 0:22
  Starbucks
• 0:22
  showed
• 0:23
  off
• 0:23
  one
• 0:23
  potential
• 0:24
  smaller
• 0:24
  location
• 0:24
  at
• 0:25
  about
• 0:25
  1350
• 0:26
  square
• 0:26
  feet,
• 0:27
  which
• 0:27
  is
• 0:27
  smaller
• 0:28
  than
• 0:28
  the
• 0:28
  typical
• 0:29
  2,500
• 0:29
  square
• 0:30
  foot
• 0:30
  footprint.
• 0:31
  These
• 0:31
  shops
• 0:32
  would
• 0:32
  still
• 0:32
  have
• 0:32
  drive
• 0:33
  thrus
• 0:33
  delivery
• 0:34
  in
• 0:34
  store
• 0:34
  and
• 0:34
  mobile
• 0:35
  ordering
• 0:35
  and
• 0:35
  they
• 0:36
  would
• 0:36
  still
• 0:36
  also
• 0:36
  have
• 0:36
  seats,
• 0:37
  but
• 0:38
  they
• 0:38
  would
• 0:38
  be
• 0:38
  cheaper
• 0:38
  to
• 0:39
  build
• 0:39
  requiring
• 0:39
  half
• 0:40
  the
• 0:40
  acreage.
• 0:41
  Brian
• 0:41
  Nichol
• 0:42
  during
• 0:42
  the
• 0:42
  presentation
• 0:43
  also
• 0:43
  did
• 0:43
  not
• 0:44
  stop
• 0:44
  at
• 0:44
  just
• 0:44
  5,000
• 0:45
  locations.
• 0:45
  Quote,
• 0:46
  there's
• 0:47
  probably
• 0:47
  another
• 0:47
  5,000
• 0:48
  sites
• 0:48
  that
• 0:48
  we
• 0:49
  can
• 0:49
  add
• 0:49
  on
• 0:49
  top
• 0:49
  of
• 0:49
  the
• 0:50
  5,000
• 0:50
  that
• 0:51
  we've
• 0:51
  already
• 0:51
  identified.
• 0:52
  And
• 0:53
  that's
• 0:53
  how
• 0:53
  you
• 0:53
  get
• 0:53
  to
• 0:54
  10,000
• 0:54
  additional
• 0:55
  stores
• 0:55
  in
• 0:55
  the
• 0:56
  U.S.
• 0:56
  end
• 0:56
  quote.
• 0:57
  Ben
• 0:57
  is
• 0:58
  Brian
• 0:58
  Nichols
• 0:59
  5,000
• 0:59
  plus
• 1:00
  small
• 1:00
  store
• 1:01
  strategy
• 1:02
  counter
• 1:03
  or
• 1:03
  congruent
• 1:03
  with
• 1:04
  his
• 1:04
  plans
• 1:04
  to
• 1:05
  try
• 1:05
  and
• 1:05
  re
• 1:06
  enliven
• 1:06
  the
• 1:06
  in
• 1:07
  store
• 1:07
  Starbucks
• 1:08
  experience.
• 1:10
  It's
• 1:10
  a
• 1:10
  great
• 1:10
  question
• 1:10
  and
• 1:11
  I'm
• 1:11
  really
• 1:11
  glad
• 1:11
  we're
• 1:12
  starting
• 1:12
  here
• 1:12
  as
• 1:12
  this
• 1:12
  story.
• 1:13
  So
• 1:14
  you
• 1:14
  know,
• 1:14
  actually
• 1:14
  to
• 1:15
  answer
• 1:15
  your
• 1:15
  question,
• 1:15
  what
• 1:16
  did
• 1:16
  I
• 1:16
  do
• 1:16
  on
• 1:16
  my
• 1:16
  first
• 1:17
  day
• 1:17
  post
• 1:17
  Shop
• 1:18
  Talk?
• 1:18
  I
• 1:18
  went
• 1:18
  back
• 1:18
  and
• 1:19
  I
• 1:19
  watched
• 1:19
  the
• 1:19
  entire
• 1:20
  video
• 1:21
  of
• 1:21
  the
• 1:22
  Starbucks
• 1:22
  investor
• 1:23
  day
• 1:23
  earlier
• 1:24
  this
• 1:24
  year
• 1:25
  because
• 1:26
  I
• 1:26
  wanted
• 1:26
  to
• 1:26
  really
• 1:26
  get
• 1:27
  under
• 1:27
  the
• 1:27
  skin
• 1:27
  of
• 1:27
  this
• 1:27
  for
• 1:28
  two
• 1:28
  things.
• 1:28
  I
• 1:29
  wanted
• 1:29
  to
• 1:29
  get
• 1:29
  a
• 1:29
  feel
• 1:30
  for
• 1:30
  the
• 1:31
  future
• 1:31
  cafe
• 1:32
  plans,
• 1:33
  but
• 1:33
  I
• 1:33
  also
• 1:33
  wanted
• 1:34
  to
• 1:34
  get
• 1:34
  a
• 1:34
  feel
• 1:34
  for
• 1:34
  where
• 1:35
  they
• 1:35
  were
• 1:35
  on
• 1:35
  this
• 1:35
  idea
• 1:36
  of
• 1:36
  the
• 1:36
  third
• 1:36
  place
• 1:37
  to
• 1:37
  see
• 1:37
  if
• 1:38
  there
• 1:38
  is
• 1:38
  a
• 1:38
  right,
• 1:39
  a
• 1:39
  contradiction
• 1:40
  there.
• 1:42
  And
• 1:42
  you
• 1:42
  know,
• 1:42
  I
• 1:43
  think
• 1:43
  we've,
• 1:43
  we've
• 1:43
  all
• 1:43
  heard
• 1:43
  Brian
• 1:44
  Nicholl
• 1:44
  talk
• 1:44
  about
• 1:44
  this
• 1:45
  in
• 1:45
  his
• 1:45
  last
• 1:45
  18
• 1:46
  months
• 1:46
  in
• 1:46
  charge
• 1:46
  of
• 1:47
  the
• 1:47
  company.
• 1:47
  But
• 1:48
  this
• 1:48
  whole
• 1:48
  idea
• 1:49
  of
• 1:49
  rebuilding
• 1:50
  the
• 1:50
  third
• 1:50
  place
• 1:51
  is,
• 1:51
  is
• 1:51
  absolutely
• 1:52
  core
• 1:52
  to
• 1:53
  the
• 1:53
  back
• 1:53
  to
• 1:53
  Starbucks
• 1:54
  plan.
• 1:54
  Now
• 1:54
  I
• 1:55
  was
• 1:55
  seeing
• 1:55
  are
• 1:55
  they
• 1:55
  moving
• 1:56
  away
• 1:56
  from
• 1:56
  this?
• 1:57
  Is
• 1:57
  there
• 1:57
  any.
• 1:57
  No,
• 1:58
  yeah,
• 1:58
  they,
• 1:59
  they,
• 1:59
  they're
• 1:59
  talking
• 1:59
  about
• 1:59
  putting
• 2:00
  more
• 2:00
  seating
• 2:00
  in.
• 2:00
  They
• 2:01
  talk
• 2:01
  about
• 2:02
  how
• 2:02
  the
• 2:02
  stores
• 2:03
  that
• 2:03
  they
• 2:03
  have
• 2:03
  put
• 2:04
  their,
• 2:04
  you
• 2:05
  know,
• 2:05
  better,
• 2:05
  more
• 2:06
  friendly
• 2:06
  concept
• 2:07
  they
• 2:07
  call
• 2:07
  the
• 2:07
  uplift
• 2:08
  program
• 2:09
  doing
• 2:09
  better
• 2:09
  comps.
• 2:10
  They
• 2:10
  talk
• 2:10
  about
• 2:11
  community
• 2:11
  gathering
• 2:12
  points,
• 2:12
  they
• 2:12
  talk
• 2:13
  about
• 2:13
  the
• 2:13
  cafe
• 2:13
  at
• 2:13
  the
• 2:14
  heart
• 2:14
  of
• 2:14
  the
• 2:14
  business.
• 2:14
  So
• 2:15
  like
• 2:15
  that's
• 2:16
  really
• 2:16
  clear
• 2:17
  when
• 2:17
  they
• 2:18
  talk
• 2:18
  about
• 2:18
  stores
• 2:19
  and
• 2:20
  I
• 2:20
  know
• 2:20
  it's
• 2:20
  a
• 2:21
  topic
• 2:21
  that
• 2:21
  you
• 2:21
  and
• 2:21
  I
• 2:21
  have
• 2:22
  talked
• 2:22
  about,
• 2:22
  you've
• 2:22
  covered
• 2:22
  in
• 2:23
  the
• 2:23
  board,
• 2:23
  they
• 2:24
  are
• 2:24
  absolutely
• 2:25
  clear
• 2:26
  that
• 2:26
  their
• 2:27
  stores
• 2:27
  need
• 2:27
  to
• 2:27
  be
• 2:27
  able
• 2:27
  to
• 2:28
  deliver
• 2:28
  on
• 2:28
  what
• 2:28
  they
• 2:29
  say
• 2:29
  are
• 2:29
  their
• 2:29
  four
• 2:30
  access
• 2:30
  points.
• 2:31
  Right.
• 2:31
  Okay.
• 2:32
  So
• 2:32
  their
• 2:33
  access
• 2:33
  points
• 2:33
  are
• 2:34
  the
• 2:34
  cafe.
• 2:34
  So
• 2:35
  sit
• 2:35
  down.
• 2:35
  This
• 2:36
  third
• 2:36
  place,
• 2:37
  it's
• 2:37
  drive
• 2:38
  thru,
• 2:38
  it's
• 2:39
  mobile
• 2:39
  order
• 2:39
  and
• 2:40
  it's
• 2:40
  delivery
• 2:41
  delivery
• 2:42
  which
• 2:42
  is
• 2:42
  already
• 2:43
  billion
• 2:43
  dollar
• 2:43
  business
• 2:44
  for
• 2:44
  them.
• 2:45
  And
• 2:45
  they're
• 2:45
  very
• 2:45
  clear
• 2:46
  that
• 2:46
  their
• 2:47
  units
• 2:47
  must.
• 2:48
  Unless
• 2:48
  it's
• 2:48
  in
• 2:48
  an
• 2:49
  incredibly
• 2:49
  high
• 2:50
  density
• 2:50
  urban
• 2:50
  environment
• 2:50
  where
• 2:51
  you
• 2:51
  can't
• 2:51
  do
• 2:51
  drive
• 2:51
  through
• 2:52
  their
• 2:52
  units
• 2:53
  must
• 2:53
  be
• 2:53
  able
• 2:53
  to
• 2:54
  do
• 2:54
  all
• 2:54
  four.
• 2:54
  So
• 2:55
  they're
• 2:55
  very,
• 2:55
  they're
• 2:56
  very
• 2:56
  glued
• 2:56
  to
• 2:57
  that
• 2:57
  as
• 2:57
  well.
• 3:00
  So
• 3:00
  then
• 3:00
  they
• 3:00
  talk
• 3:00
  about
• 3:01
  5,000
• 3:01
  new
• 3:02
  stores
• 3:03
  with
• 3:03
  an
• 3:03
  opportunity
• 3:04
  of
• 3:04
  10,000.
• 3:05
  So
• 3:05
  I
• 3:05
  guess
• 3:06
  there's
• 3:06
  two
• 3:06
  things.
• 3:06
  There's
• 3:06
  one
• 3:07
  is
• 3:07
  the
• 3:07
  where
• 3:07
  and
• 3:08
  one
• 3:08
  is
• 3:08
  then
• 3:08
  what
• 3:08
  does
• 3:08
  a
• 3:09
  unit
• 3:09
  look
• 3:09
  like?
• 3:09
  So
• 3:09
  for
• 3:09
  the,
• 3:10
  for
• 3:10
  the
• 3:10
  where
• 3:11
  they're
• 3:11
  saying
• 3:12
  they're
• 3:12
  basically
• 3:13
  they're
• 3:13
  underrepresented
• 3:14
  in
• 3:14
  the
• 3:14
  middle
• 3:15
  of
• 3:15
  the
• 3:15
  country.
• 3:15
  So
• 3:15
  they
• 3:15
  talk
• 3:15
  about
• 3:16
  the
• 3:16
  south
• 3:17
  central
• 3:17
  US
• 3:18
  and
• 3:18
  some
• 3:18
  bits
• 3:19
  of
• 3:19
  the
• 3:19
  northeast
• 3:19
  which
• 3:19
  they
• 3:19
  call
• 3:20
  that
• 3:20
  as
• 3:20
  well,
• 3:20
  which
• 3:20
  I
• 3:20
  thought
• 3:21
  was
• 3:21
  interesting.
• 3:22
  That
• 3:23
  gets
• 3:23
  them
• 3:23
  to
• 3:23
  5,000.
• 3:24
  The
• 3:25
  next
• 3:25
  5,000
• 3:26
  locations
• 3:26
  they
• 3:27
  say
• 3:27
  is
• 3:27
  unlocking
• 3:28
  afternoon.
• 3:30
  So
• 3:30
  they
• 3:30
  significantly
• 3:31
  under
• 3:31
  index
• 3:32
  sales
• 3:32
  in
• 3:32
  the
• 3:32
  afternoon.
• 3:33
  They
• 3:33
  can
• 3:33
  get
• 3:33
  a
• 3:33
  proposition
• 3:34
  that
• 3:34
  fits
• 3:34
  there.
• 3:34
  They
• 3:35
  can
• 3:35
  make
• 3:35
  more
• 3:35
  places
• 3:36
  hit
• 3:36
  the
• 3:36
  economics
• 3:37
  and
• 3:37
  that's
• 3:38
  how
• 3:38
  you
• 3:38
  get
• 3:38
  5
• 3:39
  to
• 3:39
  10,000.
• 3:41
  Their
• 3:41
  plan
• 3:41
  for
• 3:41
  next
• 3:42
  fiscal
• 3:42
  year,
• 3:42
  fiscal
• 3:43
  year
• 3:43
  28
• 3:43
  is
• 3:43
  400
• 3:44
  net
• 3:44
  new
• 3:44
  stores.
• 3:45
  So
• 3:46
  this.
• 3:46
  So
• 3:46
  there's
• 3:47
  a
• 3:47
  bit
• 3:47
  of
• 3:47
  a
• 3:47
  contradiction.
• 3:47
  They're
• 3:48
  talking
• 3:48
  about
• 3:48
  400
• 3:48
  next
• 3:49
  year,
• 3:49
  but
• 3:49
  then
• 3:49
  we
• 3:49
  can
• 3:50
  see
• 3:50
  10,000.
• 3:51
  So
• 3:51
  they're
• 3:52
  not.
• 3:52
  It's
• 3:53
  reality
• 3:53
  now
• 3:54
  versus
• 3:55
  concept
• 3:55
  later.
• 3:55
  And
• 3:56
  this
• 3:57
  is
• 3:57
  where
• 3:57
  it
• 3:57
  comes.
• 3:58
  They
• 3:58
  have
• 3:59
  developed
• 3:59
  a
• 3:59
  smaller
• 4:00
  format,
• 4:01
  half
• 4:01
  the
• 4:01
  size,
• 4:02
  lower
• 4:02
  capex,
• 4:06
  less
• 4:06
  space
• 4:06
  required.
• 4:07
  So
• 4:07
  smaller
• 4:08
  sites,
• 4:08
  smaller
• 4:09
  land.
• 4:10
  But
• 4:10
  we
• 4:10
  haven't
• 4:11
  seen
• 4:11
  it
• 4:12
  yet.
• 4:12
  We
• 4:12
  don't
• 4:12
  really
• 4:12
  know
• 4:13
  what
• 4:13
  it's
• 4:13
  like.
• 4:14
  So
• 4:15
  when
• 4:16
  you
• 4:16
  add
• 4:16
  it
• 4:16
  all
• 4:16
  together
• 4:18
  there's
• 4:18
  a
• 4:18
  bit
• 4:18
  of
• 4:18
  an
• 4:18
  alchemy
• 4:19
  and
• 4:19
  it's
• 4:19
  that
• 4:19
  alchemy
• 4:20
  that
• 4:20
  we
• 4:20
  haven't
• 4:21
  seen
• 4:21
  is
• 4:21
  how
• 4:21
  do
• 4:22
  you
• 4:22
  do
• 4:22
  all
• 4:22
  of
• 4:22
  those
• 4:23
  one
• 4:23
  things?
• 4:23
  So
• 4:24
  look,
• 4:24
  I
• 4:24
  think
• 4:25
  on
• 4:25
  the
• 4:25
  Starbucks
• 4:25
  recovery
• 4:26
  turnaround
• 4:26
  right
• 4:27
  now
• 4:28
  I'm
• 4:28
  in
• 4:28
  pure
• 4:28
  X
• 4:29
  Files
• 4:30
  mode.
• 4:30
  Yeah.
• 4:31
  So.
• 4:31
  So
• 4:32
  I,
• 4:32
  I
• 4:32
  am
• 4:32
  agent
• 4:33
  Boulder.
• 4:33
  Chris.
• 4:33
  Chris.
• 4:34
  I
• 4:34
  want,
• 4:34
  I
• 4:35
  want
• 4:35
  to
• 4:35
  believe
• 4:36
  but
• 4:36
  they've
• 4:37
  got
• 4:37
  to
• 4:37
  give
• 4:37
  me
• 4:37
  more
• 4:37
  to
• 4:38
  know
• 4:38
  what
• 4:38
  they're
• 4:38
  actually
• 4:38
  doing.
• 4:39
  So.
• 4:40
  Okay,
• 4:40
  so
• 4:40
  if
• 4:40
  I
• 4:40
  play
• 4:41
  that
• 4:41
  back
• 4:41
  the,
• 4:42
  the,
• 4:42
  the
• 4:42
  X
• 4:42
  Files
• 4:43
  analogy
• 4:43
  is
• 4:43
  great.
• 4:43
  But
• 4:44
  you're
• 4:44
  saying
• 4:44
  they're,
• 4:44
  we're,
• 4:45
  we're
• 4:45
  stuck
• 4:45
  a
• 4:45
  little
• 4:45
  bit
• 4:46
  in
• 4:46
  the
• 4:46
  hype
• 4:46
  cycle
• 4:46
  here
• 4:46
  potentially.
• 4:47
  That's
• 4:47
  one
• 4:47
  thing
• 4:48
  I'm
• 4:48
  hearing
• 4:48
  with
• 4:48
  you.
• 4:49
  But
• 4:50
  then
• 4:50
  net.
• 4:50
  Net.
• 4:51
  Do
• 4:51
  you
• 4:52
  think
• 4:52
  it's
• 4:52
  possible
• 4:53
  to
• 4:53
  have
• 4:54
  a
• 4:54
  third
• 4:54
  place
• 4:54
  experience
• 4:55
  in
• 4:55
  a
• 4:56
  1500
• 4:56
  square
• 4:57
  foot
• 4:57
  Starbucks
• 4:58
  store
• 4:58
  or
• 4:59
  Starbucks
• 4:59
  Cafe?
• 5:00
  Is
• 5:00
  that.
• 5:00
  Can
• 5:00
  you
• 5:01
  even
• 5:01
  Conceptualize
• 5:01
  that
• 5:02
  in
• 5:02
  my
• 5:02
  head
• 5:02
  because
• 5:02
  I'm
• 5:02
  having
• 5:03
  difficulty.
• 5:04
  Yeah,
• 5:04
  I
• 5:04
  can
• 5:04
  conceptualize
• 5:05
  it
• 5:05
  because
• 5:06
  the
• 5:06
  units
• 5:06
  that
• 5:07
  we
• 5:07
  have
• 5:07
  in,
• 5:07
  in
• 5:07
  Europe
• 5:08
  are
• 5:08
  often
• 5:08
  smaller
• 5:09
  than
• 5:09
  US
• 5:09
  units.
• 5:10
  So
• 5:10
  if
• 5:10
  I
• 5:10
  think,
• 5:11
  if
• 5:11
  I
• 5:11
  think
• 5:11
  of
• 5:11
  the
• 5:11
  Starbucks
• 5:12
  on
• 5:12
  my
• 5:12
  high
• 5:12
  street.
• 5:13
  Yeah,
• 5:14
  it's
• 5:14
  1500-2000
• 5:16
  square
• 5:16
  feet.
• 5:17
  So
• 5:17
  I
• 5:17
  can
• 5:18
  see
• 5:18
  how
• 5:18
  that
• 5:18
  can
• 5:19
  work
• 5:19
  as
• 5:19
  a
• 5:20
  third
• 5:20
  place.
• 5:21
  It
• 5:21
  doesn't
• 5:21
  have
• 5:22
  drive
• 5:22
  through,
• 5:23
  but
• 5:23
  drive
• 5:23
  thru
• 5:23
  is
• 5:24
  more
• 5:24
  a
• 5:24
  prop,
• 5:25
  a
• 5:25
  site
• 5:25
  play
• 5:26
  than
• 5:26
  it
• 5:26
  is
• 5:26
  a
• 5:26
  unit
• 5:27
  play.
• 5:28
  And
• 5:28
  obviously
• 5:29
  the
• 5:30
  level
• 5:30
  of
• 5:30
  mobile
• 5:30
  ordering
• 5:31
  and
• 5:31
  delivery
• 5:31
  is
• 5:32
  a
• 5:32
  lot
• 5:32
  less.
• 5:32
  But
• 5:33
  they
• 5:33
  are
• 5:33
  investing
• 5:33
  in
• 5:33
  machinery.
• 5:34
  They've
• 5:34
  got
• 5:35
  new
• 5:35
  machines
• 5:36
  that
• 5:36
  will
• 5:36
  double
• 5:36
  the
• 5:37
  speed
• 5:37
  at
• 5:38
  which
• 5:38
  espresso
• 5:38
  based
• 5:38
  drinks
• 5:39
  are
• 5:39
  made.
• 5:40
  Look,
• 5:40
  my
• 5:40
  biggest
• 5:41
  challenge
• 5:41
  to
• 5:41
  the
• 5:41
  whole
• 5:41
  thing,
• 5:42
  and
• 5:42
  I
• 5:42
  think
• 5:42
  you
• 5:42
  and
• 5:42
  I
• 5:42
  have
• 5:42
  talked
• 5:43
  about
• 5:43
  this
• 5:43
  before,
• 5:43
  is
• 5:44
  the
• 5:45
  range
• 5:45
  rationalization.
• 5:47
  Is
• 5:47
  the
• 5:47
  merchants
• 5:48
  just,
• 5:48
  you
• 5:48
  know,
• 5:48
  thinking
• 5:49
  that's
• 5:49
  going
• 5:49
  to
• 5:49
  be
• 5:49
  required
• 5:50
  to
• 5:50
  get
• 5:50
  a
• 5:50
  range
• 5:51
  that
• 5:51
  they
• 5:51
  can
• 5:51
  put
• 5:52
  through
• 5:52
  in
• 5:52
  that
• 5:52
  space.
• 5:53
  Because
• 5:53
  if
• 5:53
  they
• 5:53
  continue
• 5:54
  to
• 5:54
  proliferate.
• 5:55
  Yeah.
• 5:56
  Then
• 5:56
  that's
• 5:56
  the
• 5:56
  time
• 5:56
  it
• 5:57
  takes
• 5:57
  and
• 5:57
  that's
• 5:57
  the
• 5:57
  more
• 5:58
  workspace
• 5:58
  required
• 5:59
  and
• 5:59
  the
• 5:59
  more
• 5:59
  ingredients
• 6:00
  and
• 6:00
  that's,
• 6:00
  that's
• 6:01
  the
• 6:01
  bit
• 6:01
  I'm
• 6:01
  concerned
• 6:01
  about.
• 6:02
  Now
• 6:02
  there
• 6:03
  is
• 6:03
  talk
• 6:03
  in
• 6:03
  the
• 6:04
  analyst
• 6:04
  presentation
• 6:05
  about
• 6:06
  being
• 6:06
  more
• 6:06
  disciplined
• 6:07
  in
• 6:07
  innovation.
• 6:08
  I
• 6:08
  think
• 6:08
  that's
• 6:08
  probably
• 6:08
  the
• 6:09
  bit
• 6:09
  I'm
• 6:09
  yet
• 6:09
  to
• 6:09
  see
• 6:10
  in
• 6:10
  store,
• 6:11
  but
• 6:11
  I'm
• 6:11
  excited
• 6:12
  to
• 6:12
  hopefully
• 6:13
  see.
• 6:14
  Obviously
• 6:14
  the
• 6:14
  other
• 6:14
  bit
• 6:15
  they
• 6:15
  need
• 6:15
  to
• 6:15
  do
• 6:15
  is
• 6:15
  get
• 6:15
  their
• 6:15
  price
• 6:16
  inflation
• 6:16
  under
• 6:16
  control
• 6:17
  and
• 6:17
  that,
• 6:17
  that's
• 6:17
  one
• 6:17
  thing
• 6:18
  I'm
• 6:18
  not
• 6:18
  talking
• 6:18
  about
• 6:18
  yet.
• 6:19
  Right,
• 6:19
  right.
• 6:20
  And
• 6:20
  feels
• 6:20
  like
• 6:20
  every
• 6:21
  retailer's
• 6:21
  got
• 6:21
  that
• 6:21
  issue
• 6:21
  too
• 6:22
  to
• 6:22
  some
• 6:22
  degree.
• 6:23
  You
• 6:24
  know,
• 6:24
  the
• 6:24
  way
• 6:25
  I,
• 6:25
  I
• 6:26
  thought
• 6:26
  the,
• 6:27
  I
• 6:27
  really
• 6:27
  wanted
• 6:28
  to
• 6:28
  ask
• 6:28
  you
• 6:28
  that
• 6:28
  question
• 6:28
  to
• 6:29
  start
• 6:29
  because
• 6:29
  I
• 6:29
  think,
• 6:29
  you
• 6:30
  know,
• 6:30
  I
• 6:30
  think
• 6:31
  on
• 6:31
  the
• 6:31
  surface
• 6:32
  the
• 6:33
  idea
• 6:33
  sounds
• 6:33
  incongruent
• 6:34
  with
• 6:34
  the
• 6:34
  idea
• 6:35
  that
• 6:35
  you're
• 6:35
  going
• 6:35
  to
• 6:35
  invest
• 6:36
  in
• 6:36
  the
• 6:36
  third
• 6:36
  place
• 6:37
  because,
• 6:37
  you
• 6:37
  know,
• 6:38
  generally
• 6:38
  speaking,
• 6:38
  especially
• 6:39
  in
• 6:39
  the
• 6:39
  U.S.
• 6:39
  the
• 6:39
  typical
• 6:40
  footprint
• 6:40
  is
• 6:40
  bigger.
• 6:41
  It's,
• 6:41
  you
• 6:41
  know,
• 6:41
  it's
• 6:42
  got
• 6:42
  the
• 6:42
  atmosphere,
• 6:43
  et
• 6:43
  cetera.
• 6:44
  But
• 6:44
  as
• 6:44
  I
• 6:44
  step
• 6:45
  back
• 6:45
  from
• 6:45
  it,
• 6:45
  I
• 6:46
  think
• 6:46
  that's
• 6:46
  okay
• 6:47
  because
• 6:47
  both
• 6:47
  things
• 6:48
  can
• 6:48
  be
• 6:48
  true.
• 6:49
  The
• 6:49
  existing
• 6:49
  store
• 6:50
  base
• 6:50
  can
• 6:50
  need
• 6:50
  a
• 6:51
  refresh
• 6:51
  and
• 6:51
  a,
• 6:52
  and
• 6:52
  also
• 6:52
  I
• 6:53
  might
• 6:53
  add
• 6:53
  a
• 6:53
  jolt
• 6:53
  of
• 6:53
  employee
• 6:54
  support
• 6:54
  and
• 6:55
  inspiration,
• 6:55
  which
• 6:55
  is
• 6:56
  also
• 6:56
  a
• 6:56
  key
• 6:56
  piece
• 6:57
  of
• 6:57
  the
• 6:57
  Back
• 6:57
  to
• 6:57
  Starbucks
• 6:58
  plan
• 6:59
  that
• 6:59
  Nichols
• 7:00
  laid
• 7:00
  out.
• 7:00
  And
• 7:01
  then
• 7:01
  the
• 7:01
  second
• 7:01
  thing
• 7:01
  is,
• 7:02
  longer
• 7:02
  term,
• 7:03
  Starbucks
• 7:03
  also
• 7:04
  potentially
• 7:04
  does
• 7:04
  need
• 7:05
  a
• 7:05
  new
• 7:05
  format
• 7:05
  to
• 7:06
  spread
• 7:07
  out
• 7:07
  operational
• 7:08
  demand
• 7:08
  as
• 7:08
  well
• 7:09
  as
• 7:09
  tap
• 7:09
  into
• 7:09
  new
• 7:09
  markets.
• 7:10
  Because
• 7:10
  the,
• 7:11
  the
• 7:11
  demand,
• 7:11
  especially
• 7:11
  with
• 7:11
  mobile
• 7:12
  order
• 7:12
  and
• 7:12
  drive
• 7:12
  thru,
• 7:13
  is
• 7:13
  just
• 7:13
  getting
• 7:13
  too
• 7:13
  high
• 7:14
  at
• 7:14
  many
• 7:14
  of
• 7:14
  these
• 7:14
  locations.
• 7:15
  But
• 7:16
  with
• 7:16
  that
• 7:16
  said,
• 7:16
  Ben
• 7:17
  and
• 7:17
  I'm
• 7:17
  gonna
• 7:18
  let,
• 7:18
  let
• 7:18
  everyone
• 7:18
  in
• 7:18
  on
• 7:19
  a
• 7:19
  little
• 7:19
  Inside
• 7:19
  baseball
• 7:20
  here.
• 7:20
  The
• 7:20
  thing
• 7:20
  that
• 7:21
  really
• 7:21
  frustrates
• 7:22
  me
• 7:22
  though
• 7:22
  is
• 7:23
  when
• 7:23
  he
• 7:23
  made,
• 7:24
  when
• 7:24
  he
• 7:24
  was
• 7:24
  touting
• 7:25
  the.
• 7:26
  Or
• 7:27
  I
• 7:27
  don't
• 7:27
  know
• 7:27
  if
• 7:27
  it's
• 7:27
  him
• 7:27
  or
• 7:28
  somebody
• 7:28
  else
• 7:28
  in
• 7:28
  their,
• 7:29
  in
• 7:29
  one
• 7:29
  of
• 7:29
  their
• 7:30
  reports,
• 7:31
  the
• 7:31
  amount
• 7:31
  of
• 7:32
  delivery
• 7:32
  that
• 7:32
  they're
• 7:32
  doing.
• 7:34
  And
• 7:34
  I
• 7:34
  wrote
• 7:34
  an
• 7:34
  article
• 7:34
  for
• 7:35
  Forbes
• 7:35
  saying,
• 7:35
  well,
• 7:35
  that's
• 7:35
  a
• 7:36
  testament
• 7:36
  to
• 7:36
  the
• 7:36
  fact
• 7:36
  that,
• 7:37
  you
• 7:37
  know,
• 7:37
  maybe
• 7:37
  you
• 7:38
  don't
• 7:38
  need
• 7:38
  that
• 7:38
  third
• 7:38
  place
• 7:39
  experience
• 7:39
  for
• 7:39
  the
• 7:39
  average
• 7:40
  Starbucks,
• 7:40
  for
• 7:40
  the
• 7:41
  average
• 7:41
  Starbucks
• 7:41
  customers.
• 7:42
  Maybe
• 7:42
  it's
• 7:42
  not
• 7:42
  that
• 7:42
  important
• 7:42
  when
• 7:43
  you
• 7:43
  see
• 7:43
  delivery
• 7:43
  growing
• 7:44
  the
• 7:44
  way
• 7:44
  that
• 7:44
  it
• 7:44
  is.
• 7:44
  And
• 7:45
  I
• 7:45
  immediately
• 7:46
  got
• 7:46
  a
• 7:46
  call
• 7:46
  from
• 7:46
  their
• 7:46
  comps
• 7:47
  team
• 7:47
  and
• 7:47
  I
• 7:47
  spent
• 7:48
  an
• 7:48
  hour,
• 7:49
  you
• 7:49
  know,
• 7:49
  on
• 7:49
  the
• 7:50
  phone
• 7:50
  with
• 7:50
  them
• 7:51
  debating.
• 7:52
  Basically
• 7:52
  my
• 7:52
  point
• 7:52
  was
• 7:53
  like,
• 7:53
  okay,
• 7:54
  you
• 7:54
  can
• 7:54
  say
• 7:54
  you're
• 7:54
  always
• 7:55
  going
• 7:55
  to
• 7:55
  put
• 7:56
  chairs
• 7:57
  and
• 7:57
  seating
• 7:58
  in
• 7:58
  your
• 7:58
  cafes,
• 7:59
  but
• 7:59
  can't
• 8:00
  you
• 8:00
  just
• 8:00
  at
• 8:00
  least
• 8:00
  tell
• 8:00
  me
• 8:01
  you're
• 8:01
  leaving
• 8:01
  the
• 8:01
  option
• 8:01
  open
• 8:02
  to
• 8:02
  go
• 8:02
  down
• 8:02
  that
• 8:03
  road?
• 8:03
  And,
• 8:03
  and
• 8:03
  so
• 8:04
  this
• 8:04
  tells
• 8:04
  me
• 8:04
  that
• 8:04
  you
• 8:05
  probably
• 8:05
  still
• 8:05
  are
• 8:06
  hedging
• 8:06
  that
• 8:06
  way.
• 8:07
  Especially
• 8:07
  Ben,
• 8:08
  if
• 8:08
  you,
• 8:08
  as
• 8:09
  someone
• 8:09
  that
• 8:09
  follows
• 8:09
  this
• 8:10
  industry
• 8:10
  as
• 8:10
  closely
• 8:10
  as
• 8:10
  you
• 8:11
  do
• 8:11
  is
• 8:11
  also
• 8:11
  saying
• 8:11
  this
• 8:12
  sounds
• 8:12
  like
• 8:12
  a
• 8:12
  little
• 8:12
  bit
• 8:12
  of
• 8:12
  hype.
• 8:13
  You
• 8:13
  don't
• 8:13
  know
• 8:13
  what
• 8:13
  to
• 8:13
  believe.
• 8:14
  And
• 8:14
  it's
• 8:14
  kind
• 8:15
  of
• 8:15
  X
• 8:15
  File
• 8:15
  ish
• 8:15
  as
• 8:16
  well.
• 8:16
  So
• 8:17
  I
• 8:17
  don't
• 8:17
  know.
• 8:17
  That's,
• 8:17
  that's
• 8:18
  the
• 8:18
  one.
• 8:18
  Just
• 8:19
  misgiving
• 8:19
  I
• 8:19
  have
• 8:20
  about
• 8:20
  this
• 8:20
  is
• 8:20
  like
• 8:20
  it
• 8:21
  doesn't,
• 8:22
  it
• 8:22
  doesn't
• 8:22
  feel
• 8:22
  like
• 8:23
  everything
• 8:23
  is
• 8:23
  being
• 8:23
  as
• 8:24
  transparent
• 8:24
  as
• 8:25
  it
• 8:25
  could
• 8:25
  be.
• 8:26
  But
• 8:26
  you
• 8:26
  know,
• 8:26
  time
• 8:27
  will
• 8:27
  tell.
• 8:27
  But
• 8:27
  do
• 8:27
  I
• 8:27
  think
• 8:28
  it's
• 8:28
  a
• 8:28
  bad
• 8:28
  strategy?
• 8:28
  I
• 8:29
  don't
• 8:29
  think
• 8:29
  I
• 8:29
  do.
• 8:29
  I
• 8:29
  think
• 8:30
  it's
• 8:30
  smart.
• 8:31
  But
• 8:31
  there
• 8:31
  are
• 8:31
  inconsistencies
• 8:32
  in
• 8:32
  the
• 8:32
  logic
• 8:33
  that
• 8:33
  are
• 8:33
  worth
• 8:33
  pointing
• 8:33
  out,
• 8:33
  which
• 8:33
  is
• 8:34
  why,
• 8:34
  why,
• 8:35
  why
• 8:36
  we
• 8:36
  started
• 8:37
  Omni
• 8:37
  Talk
• 8:37
  to
• 8:37
  begin
• 8:38
  with
• 8:38
  was
• 8:38
  to
• 8:39
  call
• 8:39
  things
• 8:39
  out
• 8:39
  when
• 8:40
  things
• 8:40
  just
• 8:40
  aren't
• 8:41
  making
• 8:41
  sense
• 8:41
  and
• 8:41
  aren't
• 8:42
  lining
• 8:42
  up.
• 8:42
  But
• 8:43
  Ben,
• 8:43
  what
• 8:43
  do
• 8:43
  you
• 8:43
  think?
• 8:44
  Yeah,
• 8:44
  and
• 8:45
  I
• 8:45
  think
• 8:45
  that's
• 8:45
  where
• 8:45
  it's
• 8:46
  incredibly
• 8:46
  exciting.
• 8:47
  You
• 8:48
  can
• 8:48
  see
• 8:48
  the
• 8:48
  logic.
• 8:49
  Yeah,
• 8:50
  you
• 8:50
  can
• 8:50
  see
• 8:50
  the
• 8:51
  numbers.
• 8:51
  Look,
• 8:51
  all
• 8:51
  credit
• 8:52
  to
• 8:52
  Brian
• 8:52
  and
• 8:52
  the
• 8:52
  team.
• 8:52
  The
• 8:53
  comps
• 8:53
  are
• 8:53
  at
• 8:53
  plus
• 8:53
  4%
• 8:54
  having
• 8:54
  been
• 8:55
  at
• 8:55
  yeah,
• 8:56
  high
• 8:57
  single
• 8:57
  digit
• 8:57
  negatives
• 8:58
  before
• 8:58
  they
• 8:59
  join.
• 8:59
  So
• 8:59
  yeah,
• 9:00
  the
• 9:00
  team
• 9:00
  are
• 9:01
  in,
• 9:01
  the
• 9:01
  team
• 9:01
  are
• 9:01
  improving,
• 9:02
  the
• 9:02
  install
• 9:03
  standards
• 9:03
  are
• 9:03
  getting
• 9:03
  better
• 9:05
  and
• 9:05
  maybe
• 9:05
  they
• 9:06
  have
• 9:06
  as
• 9:06
  a
• 9:06
  team
• 9:07
  seen
• 9:07
  something
• 9:07
  to
• 9:08
  be
• 9:08
  able
• 9:08
  to
• 9:08
  drive
• 9:09
  some
• 9:09
  efficiencies
• 9:09
  out
• 9:09
  the
• 9:10
  back
• 9:10
  office
• 9:10
  and
• 9:10
  the
• 9:10
  way
• 9:11
  that
• 9:11
  they
• 9:11
  were,
• 9:11
  they've
• 9:12
  got,
• 9:12
  look,
• 9:12
  they've
• 9:12
  got
• 9:12
  an
• 9:13
  almost
• 9:13
  new
• 9:13
  executive
• 9:13
  team,
• 9:14
  they've
• 9:14
  got
• 9:14
  a
• 9:14
  new
• 9:14
  coo,
• 9:15
  they've
• 9:15
  got
• 9:15
  a
• 9:15
  new
• 9:15
  cmo.
• 9:16
  So
• 9:16
  maybe
• 9:17
  they've
• 9:17
  seen
• 9:17
  something
• 9:18
  and
• 9:18
  then
• 9:18
  hopefully
• 9:19
  they'll
• 9:19
  invite
• 9:19
  the
• 9:20
  analyst
• 9:20
  community,
• 9:20
  we'll
• 9:21
  get
• 9:21
  to
• 9:21
  see
• 9:21
  these
• 9:21
  smaller
• 9:21
  stores
• 9:22
  and
• 9:22
  then
• 9:22
  you
• 9:22
  can
• 9:23
  see
• 9:23
  how
• 9:23
  they've
• 9:23
  pulled
• 9:23
  it
• 9:23
  off.
• 9:24
  It's
• 9:24
  just
• 9:25
  the
• 9:25
  unknown
• 9:27
  makes
• 9:27
  you
• 9:28
  curious
• 9:29
  at
• 9:29
  the
• 9:29
  moment.
• 9:30
  Yeah.
• 9:30
  And
• 9:31
  to
• 9:31
  your
• 9:31
  point,
• 9:31
  with
• 9:31
  all
• 9:31
  those
• 9:31
  mobile
• 9:32
  orders
• 9:32
  coming
• 9:32
  in
• 9:32
  and
• 9:33
  drive
• 9:33
  through
• 9:33
  orders
• 9:33
  coming
• 9:33
  in,
• 9:34
  maybe
• 9:34
  you
• 9:34
  don't
• 9:34
  need
• 9:35
  as
• 9:35
  much
• 9:35
  seating
• 9:36
  space
• 9:36
  in
• 9:36
  the
• 9:36
  store
• 9:36
  too,
• 9:37
  and
• 9:37
  you
• 9:38
  can
• 9:38
  still
• 9:38
  have
• 9:38
  a
• 9:38
  vision
• 9:39
  that
• 9:40
  still
• 9:40
  complements
• 9:41
  the
• 9:41
  third
• 9:41
  place
• 9:41
  idea.
• 9:42
  Yeah,
• 9:42
  that's
• 9:42
  a
• 9:42
  great
• 9:42
  point.