US: Starbucks ventures into vending – with some ambitious competition

As if it wasn’t already ubiquitous, Starbucks has announced plans to roll out hundreds of coffee vending machines, sans baristas, by the end of year …. while one ‘healthy’ vending company has announced its ambitions to be the coffee giant’s main competitor in five years.
Starbucks, the food and beverage giant who has established a location on literally every street corner in every major US city, has declared its coffee will be even more readily accessible with the announcement of coffee kiosks.

In a move that directly contradicts the Starbucks’ position of “putting people before products”, the company, through its Seattle’s Best Coffee label, has teamed up with Coinstar and a small Bellevue company, Concordia Coffee Co, on automated, self-serve espresso kiosks in grocery stores in eight states.

The idea is to “bring coffee to places where you wouldn’t or couldn’t put a full-service espresso bar,” said Tom Ehlers, general manager and VP of Seattle’s Best Coffee.

The machines, which grind their own beans, crank out lattes, mochas, chai teas, hot chocolates and drip coffees. There are 86 machines installed in Albertsons stores and other groceries in Washington, Oregon, Idaho, Utah, Illinois, Wisconsin, Maryland and Tennessee. The machines take credit and debit cards, cash and coins.
Some 500 kiosks will be rolled out in grocery, drug and mass merchant stores by the end of the year, meaning Starbucks junkies will be able to get their hands on a tasty cup of java any hour of the day or night, with Starbucks planning to establish thousands of locations in the next several years.
The drinks will start at just a buck for a cup of coffee and some extra change for a fancier drink.

Fresh-Healthy-Vending-CafeA keen competitor…

Meanwhile, San Diego company, Fresh Healthy Vending Cafe aims to become Starbucks’ biggest competitor within the next five years.

Itis franchised high-tech vending machines serve up fresh brewed organic coffee within seconds, and for a fraction of the cost, and also offer a range of natural, organic and healthy snacks.

“For consumers, it comes as a delicious way to save money. For entrepreneurs, it provides a rock-solid way to gain an edge in the business market, as the trend gains momentum and machines are placed around the country,” it says.

“Our strategy is to bring great coffee to new and unexpected locations as well as healthy snacks and drinks where it’s traditionally been hard to find these high quality products,” said Dan Negroni, CEO of Fresh Healthy Vending.

“We believe our Fresh Healthy Vending Cafe will definitely change the way people think about coffee as the specialty coffee products coming out of our machines are on par with what people expect from a barista at their local coffee shop and to top that off they can purchase a healthy snack or cold drink from the refrigerated section of our machines by just putting in cash or a credit card.”

Fresh Healthy Vending is prepared to install its ‘revolutionary’ new Fresh Healthy Vending Cafe kiosk in offices, universities, grocery, drug, and mass merchant retail channels, across the country. The machines feature Organic coffee specialty drinks, along with an assortment of healthy snacks and cold drinks. The premier machine is the first of its kind to hit America.

The Fresh Healthy Vending Cafe kiosk rollout will begin in summer 2012, with 500 kiosks expected to be placed by the end of the year, and thousands of kiosks expected to be placed over the next several years.

The kiosks occupy roughly eight square feet, and grind and brew fresh whole beans in a single cup, as well as specialty coffee drinks such as vanilla lattes and cappuccinos, with price points beginning at $1.00 per cup of coffee with more specialty drinks costing up to $2.50 per cup. The kiosk also features an assortment of organic and natural snacks and cold drinks in the refrigerated section of the kiosk including fresh juices, fruit, energy bars, and other health snacks, at price points between $1.00 and $3.00.

The company has targeted a run-rate of $15,000-$40,000 in annual revenue per kiosk depending on the foot traffic of the particular location.

“With the overwhelming response we’ve had from consumers and locations to our nationwide network of 1500 healthy vending machines, we’ve had weekly requests from locations asking us if we could provide a high quality coffee vending machine,” added Negroni. “We’ve listened, and now our growing franchise network is excited about the prospect for placing thousands of Fresh Healthy Vending Cafe kiosks nationwide over the next few years.”

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