GMCR: Starbucks Timetable Could Lift Brewer Sales

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David Evanson and Scott Van Winkle, Summer, 2011

Canaccord Genuity consumer analyst Scott Van Winkle said that the timing of Starbucks’ launch of K-cups could provide a lift to Green Mountain Coffee Roasters’ Keurig brewer sales. He said:

“As expected, Starbucks K-cups will be available in supermarkets and specialty retailers this fall, although we had hoped for September rather than November. The key is availability before the holiday selling season begins in late November to ensure that the availability of the Starbucks brand can deliver the incremental brewer sales that we anticipate it will. In all, we are encouraged by the announcement, which implies that the capacity ramp this summer has gone according to schedule, but are disappointed that availability in Starbucks stores will not occur until late 2012. This implies that a significant distribution lift from Starbucks stores won’t impact GMCR until F2013. We also suspect that given Starbucks K-cups will be available in packages as small as 10-count, the price point will be at least $1/cup, which is consistent with our expectations.”