Starbuck Coffee Making A Change For The Better?

Starbucks (NASDAQ:SBUX) is celebrating their fortieth anniversary by changing it’s logo. The new one is not totally unfamiliar. It’s still a green circle that features a mermaid; but the words “Starbucks” and “Coffee” are gone. Actually, the figure in the circle, who has been part of the logo since the beginning, is Melusine, a feminine fresh water nymph or spirit of sacred springs and rivers.

Melusine was a character from European folklore and legends, usually depicted as a woman from the waist up and a snake or fish from the waist down, sometimes shown with two tails and/or wings. In heraldry, Melusine was usually shown on German coats of arms supporting her split tail with her arms, as in Starbucks’ familiar icon. The folks at Starbucks consistently insist that Melusine is a siren, not a mermaid. As we all know, mermaids live in salt water oceans, so a siren of fresh-water and sacred springs is certainly a better choice as a mascot for coffee.

Predictably, the change has caused a storm of protest and controversy. Many wonder why any company would take their name off their products, forgetting that Nike (NYSE:NKE) did just that, leaving their perfectly recognizable swoosh as their brand. Others point to the Gap (NYSE:GPS) logo fiasco, in which public outcry forced that struggling company to change back within a week.

However this is not the first time that the coffee giant has changed its logo. Their first was developed when the company started in 1971. The first time they changed it was in 1987, when they added espresso beverages. They changed it again when the company went public in 1992. Now, on their 40th birthday, Starbucks has decided to expand their product line beyond coffee and tea. They might even begin serving beer and wine after hours.

If that’s the case, it makes sense to remove the limiting “coffee” label from their emblem. Customers can expect to begin seeing the new symbol in March 2011. As to whether the public will learn to associate coffee with a mermaid…ur…siren, is yet to be seen.

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Coffee And Tea ‘Cut Heart Disease Risk’!

Drinking coffee or tea in moderation reduces the risk of developing heart disease, according to a new study.Researchers in The Netherlands found that drinking more than six cups of tea per day was associated with a 36 percent lower risk of heart disease compared to those who drank less than one cup of tea per day. Drinking three to six cups of tea per day was associated with a 45 percent reduced risk of death from heart disease, compared to consumption of less than one cup per day.

And for coffee, the researchers found that drinkers with a modest intake, two to four cups per day, had a 20 percent lower risk of heart disease compared to those drinking less than two cups or more than four cups.Although not considered significant, moderate coffee consumption slightly reduced the risk of heart disease death and deaths from all causes.Researchers also found that neither coffee nor tea consumption affected stroke risk.

“While previous studies have shown that coffee and tea seem to reduce the risk of heart disease, evidence on stroke risk and the risk of death from heart disease was not conclusive. Our results found the benefits of drinking coffee and tea occur without increasing risk of stroke or death from all causes,” said Yvonne T. van der Schouw, study senior author and professor of chronic disease epidemiology, Julius Center for Health Sciences and Primary Care, University Medical Center Utrecht, The Netherlands.

Van der Schouw and colleagues used a questionnaire to evaluate coffee and tea consumption among 37,514 participants. They followed the participants for 13 years for occurrences of cardiovascular disease and death.

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Coffee sellers create a showcase

Sometimes it’s not just about the bottom line. Parisi Artisan Coffee wants to make a profit with its first retail location, of course, but it also wants a flagship location that will showcase its products and give back to the community.

So the owners are taking two small spaces in Union Station. They plan a late spring opening in the historic station at 30 W. Pershing Road. “It gives us an opportunity to show who we are, and it provides a service for a civic location,” said Joseph Paris, vice president of Paris Brothers, parent company of Parisi. “If we were worried strictly about a return on investment it may not make sense. But we believe in what is going on down there.

Union Station also is home to an expanding list of new tenants, including the Greater Kansas City Chamber of Commerce and the Kansas City Area Development Council. Paris Brothers is a specialty food company founded in 1983. It imports, manufactures and distributes products such as pastas, olive oils and cheeses to local grocery stores and many in the four-state area. It also sells to institutional suppliers such as Sysco Corp. and U.S. Foodservice.

Brothers Joseph and Salvatore Paris founded Parisi Artisan Coffee in 2006 using 100 percent arabica beans drum-roasted in small batches. Clients include the Raphael Hotel, the New Theatre Restaurant, Westport Coffee House, Café Europa and the Kansas City Ballet.

“Coffee for us was a natural progression. Way back when, we used to distribute Italian coffees, before espresso became a craze,” Joseph Paris said. Parisi also has one of the largest temperature-controlled, green coffee storage facilities in the country, in the Hunt Midwest SubTropolis underground industrial park. Coffee importers across the country store their green coffee beans there for distribution to roasters.

The brothers will test the retail waters with the Union Station location before considering other locations. The shop will not only offer coffee drinks, but food designed to go with specific drinks. The menu is still in the planning stages.

“Upscale items, a few surprises. Something to get your eyes and palate going,” Joseph Paris said. Plaza favorite signs 10-year lease Fans of the Country Club Plaza’s Granfalloon — rejoice. The bar at 608 Ward Parkway is sticking around. It signed a new 10-year lease that will take it to the end of 2020.

Not only that, this spring the owner will remodel, add an outdoor patio on the east side (taking six of the parking spots in that small lot), and introduce a new menu that will be a bit more upscale. The Granfalloon has been on the Plaza since 1977 and in its current spot for more than a decade. Tim Caniglia has owned it since 1994.

“I’m excited because we are getting a patio. That’s the big thing we have been missing,” Caniglia said. “And the last couple, three months, it has been really busy down here. I looked at other locations, and even though the rent is cheaper I was worried about traffic. Here, we are guaranteed traffic on certain months.”

Reports were rampant last March that Highwoods Properties planned to replace both re:Verse and Granfalloon. Re:Verse did close to make way for Coal Vines, a specialty pizza and wine bar that is scheduled to open in early February. Granfalloon’s lease was up in July and when negotiations weren’t completed then, Caniglia just extended his lease.

As for those rumors that Highwoods is in discussion with Chili’s Grill & Bar to open on the Plaza, not true, said Gayle Terry, director of marketing for the Plaza: “We have not had any discussions with Chili’s.”

Quick bites

•Firehouse Subs plans to open at Olathe Pointe, 15137 W. 119th St., Olathe, on March 1.

•Three tenants at the Legends Outlets Kansas City have closed. However, the center already has tentative agreements to replace them with tenants tied more to its new destination outlet concept.

The locally owned Los Cabos, A Mexican Restaurant & Rooftop Fiesta specialized in foods from Mexico and had an expansive tequila bar. There is still a location in Mission Farms in Leawood. The owners did not return phone calls. Pin-Up Bowl, a St. Louis-based trendy bowling alley concept, had a posh lounge serving 30 martinis. It opened four years ago.

“They asked us to move as part of their transition process,” said Joe Edwards, owner of the original Pin-Up Bowl in St. Louis. “We thank everyone who came. It was a nice time in Kansas City, Kan. — the customers, staff, vendors and the Legends were all top-notch.”

Wyldewood Cellars operated there for five years. “In my opinion it had extremely high overhead, it was not a good location and it was bad timing with the economy,” said Merry O’Callahan-Bauman, spokeswoman for the company. Legends Outlets Kansas City is at Interstate 435 and State Avenue in Kansas City, Kan.

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Starbucks stirs ire with new logo

Starbucks, the world's biggest coffee chain, has unveiled a new logo that omits its name and the word "coffee", infuriating loyal customers. The new green logo is essentially Starbucks' representation of a female siren - a half-human mythical temptress who led sailors to their deaths. The change, announced overnight during a webcast of a company meeting, comes as Starbucks is building new billion-dollar brands sold outside its cafes.

"Even though we have been, and always will be, a coffee company and retailer, it's possible we'll have other products with our name on it and no coffee in it," chief executive Howard Schultz said on the webcast. The company, based in Seattle, Washington, has not changed its logo since it went public in 1992.

Self-described Starbucks fanatics were not impressed and, among hundreds of comments on Starbucks' website, called for the company's name to be put back into the logo.

"Who's the bonehead in your marketing department that removed the world-famous name of Starbucks Coffee from your new logo? This gold card user isn't impressed!" wrote one customer who identified herself as MimiKatz.

Another wrote: "I have been a big supporter of (Starbucks) since the early days, taken expensive rides in taxis to get my morning coffee, even waded through two feet of snow in my business suit ... but I do not see the logic of your Business Development folks for the removal of the Starbucks name."

Executives said the logo, designed in-house, would be phased in, appearing first on paper products like cups and napkins in March. Starbucks declined to say how much it would cost to switch to the new logo.

Starbucks has come through a restructuring over the past few years, during which it closed almost 1000 stores around the world and put more emphasis on brands like instant coffee Via and Seattle's Best Coffee.

It is now fighting Kraft Foods Inc for control of its grocery distribution business.

'It's nuts'

Some brand experts questioned whether the logo change was a smart move, and even likened it to a recent ill-fated attempt by clothing chain Gap Inc to change its well-known brand image.

"I think it's nuts," said James Gregory, chief executive of brand consulting firm CoreBrand. "What's it going to be - the coffee formerly known as Starbucks?"

The new logo probably will not hurt cafe sales in the near term because most Starbucks customers are enthusiasts, Gregory said. But, he said, a nameless logo was a bad fit for Starbucks products sold by grocery stores and other retailers.

"There you're dealing with people who aren't enthusiasts. You're looking at something that's almost generic, and it's not shouting out as something that is Starbucks."

"If they want to extend the brand, they can keep the 'Starbucks' and lose the 'Coffee'," said Alan Siegel, founder and CEO at Siegel+Gale, a strategic branding firm.

Several well-known companies, including Apple and Nike, have long used only symbols to represent their brands.

Robert Passikoff, president and founder of Brand Keys, a consumer and brand loyalty consulting firm, said the action could prove wise if Starbucks moved more aggressively into a wider portfolio of consumer goods.

"If it isn't (the reason for the change) and they're just trying to freshen stuff up, no one cares," he said.

Marian Salzman, president of Euro RSCG Worldwide PR North America, said the explosion of social media and real-time feedback was working against the company.

"Nothing is worse than an armchair quarterback," she said. "Nothing ever ends well that starts this way."

Asked if she thought Starbucks would follow Gap's lead and scrap the logo, she said: "Ask me on Monday."

This is not the first time Starbucks has been criticized for revamping a logo: last year it stood behind a new logo for Seattle's Best Coffee despite criticism from customers and others.

The company timed the debut of the new Starbucks logo to coincide with the 40th anniversary of the founding of the first Starbucks store in Seattle in 1971.

The founders of that artisan coffee shop were looking for a way to capture the seafaring history of coffee, and Seattle's strong seaport roots when they found a 16th century Norse woodcut of a twin-tailed mermaid that fit the bill.

Over the years, their siren has been transformed from a bare-breasted mermaid grasping a tail in each hand to a more graphic, family-friendly image. "Our new evolution liberates the siren from the outer ring, making her the true, welcoming face of Starbucks," the company said.

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Peru’s Tunki coffee sells in Spain and England

More than 2,000 kilograms of Tunki coffee, awarded as the best special coffee in the world, was successfully sold in Spain and England during 2010, reported Andina.

Recognized in April 2010 as one of the best high quality coffees in the world by The Specialty Coffee Association of America (SCAA), has been sold to Spanish companies and restaurants of renowned Peruvian chef Gastón Acurio. The announcement was made by Miguel Paz, commercialization manager for the Organization of Sandia Valley Agrarian Coffee Cooperatives (Cecovasa).

Around 230 kg of coffee were sold to England and 350 kg to Spain, he said. The company's target is not to increase production or conquer new markets but to maintain the quality of the product, assured Paz.

"We want to strengthen the presence of our products in the gourmet coffee market to improve product prices," he said. Paz also said that sales in 2010 increased by approximately 30 percent over the previous year. “However, we are not in line with international market prices yet," he added.

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Tight Markets Seen for Coffee, Sugar, Cotton

A scarcity of commodities such as cotton, sugar and coffee that propelled prices to historic highs late in 2010 is expected to continue into 2011, and it could mean more prices increases for consumers. Cotton, sugar and coffee are seen remaining in recent high price ranges as supplies remain low.

Cotton broke a post-Civil War record in December, as supplies from top producers failed to keep up with demand, particularly China's voracious appetite for the fiber. Cotton futures gained 91.5% for the year; the March contract closed 2010 on the InterContinental Exchange at $1.4481 a pound on Friday.

The run up has led some large clothing manufacturers to increase prices. In December, Hanesbrands Inc. said it will raise prices in the first quarter to offset higher cotton costs, and that it is considering more increases for mid-2011. VF Corp., which produces The North Face, Lee and Wrangler clothing, recently said it expects to "have select price increases across our portfolio of brands next year."

A late harvest in India and lower estimates for stockpile levels in July, when the U.S. crop year ends, have pushed prices higher. Little relief is expected until the next U.S. harvest in fall 2011.

"We're going to be living with historically high prices for the rest of 2011," said Mike Stevens, an independent cotton analyst based in Mandeville, La. "I see nothing on the horizon that would change that, short of severe economic slowdown."

Coffee prices, which hit their highest prices since mid 1997 this year, are also expected to stay high. The emergence of new coffee drinkers in Brazil and China and sustained demand in North America and Europe through the economic downturn were met with lower output from top producers of the prized, mild washed arabica beans. Torrential rain tore through Colombia and Central America this year.

Coffee futures rose 77% this year, ending 2010 at $2.4050 a pound.

The higher prices have led Starbucks Corp., Kraft Foods Inc. and Farmer Bros. Corp. to raise prices for some of their products this year, and more increases may be on the way for other companies.

"While many of our franchises have held their prices steady for more than three years, we expect that some may make modest adjustments to coffee prices in their restaurants," said a spokeswoman for Dunkin' Brands Inc., which owns Dunkin' Donuts. The company uses only arabica beans.

In December, consistently low supplies of arabica coffee prompted the IntercontinentalExchange Inc. to include arabica beans from Brazil, the world's top producer, on its list of grower nations for the benchmark "C" contract. The deal, one decade in the making, is expected to boost liquidity in the market and will take effect in March 2013.

Sugar prices have also seen a dramatic run-up, touching nearly three-decade highs in 2010. The prices are expected to stay strong as India cautiously weighs increasing exports and wet weather hampers the crop out of Australia.

"We need to look at supply concerns," said Sterling Smith, an analyst with Country Hedging. "That creates a situation of vulnerability in the market."Raw sugar futures gained 19% in 2010, ending the year at 32.12 cents a pound.

Cocoa prices saw some gains in December, but haven't risen dramatically despite the ongoing political crisis in top producer Ivory Coast. Many large cocoa companies have said they don't expect the impasse there to affect shipments unless a civil war breaks out. Cocoa futures shed 7.7% this year, ending at $3,035 a ton.

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Starbucks denies Kraft did well in coffee sales

Starbucks said late last month that it wanted to end its relationship with Kraft as the world's largest coffee shop chain seeks to boost sales outside its own stores through having a greater role in the distribution of its packaged goods. The business generates $500 million in annual sales for Kraft and has high profit margins. Kraft pays Starbucks a royalty fee based in part on the performance of the business.

Following Starbucks' decision to end the agreement, Kraft escalated the battle by asking a federal court to stop the coffee chain from trying to sell its packaged coffee through a different distributor.

However, Starbucks said it denies that Kraft's distribution of its products is performing extremely well, court documents showed. "Starbucks denies that it has repeatedly praised Kraft for the quality and effectiveness of its performance under the agreement," the company said in its response to Kraft's filing.

The Seattle coffee company also asked the court to deny Kraft's request to prevent Starbucks from trying to sell its packaged coffee through a different distributor. The case is in re: Kraft Foods Global Inc v. Starbucks Corp, Case No. 10-09085, U.S. District Court for the Southern District of New York.

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