Coinstar to Launch Starbucks’ Seattle’s Best Coffee Kiosks

by Christopher Freeburn | June 6, 2012 10:25 am

Coinstar to Launch Starbucks’ Seattle’s Best Coffee Kiosks

Want a cup of coffee, but can’t find a nearby Starbucks? Or maybe you just don’t want to pay $6 for a latte?

Well, you may soon be able to get a hot cup of Seattle’s Best coffee, which is owned by Starbucks‘ (NASDAQ:SBUX[1]), at your local supermarket or drugstore.

Starbucks has signed a five year deal with Coinstar (NASDAQ:CSTR[2]) to launch thousands of coffee-dispensing kiosks nationwide[3].

The automated kiosks, named “Rubi,” will serve Seattle’s Best coffee for $1 a cup in supermarkets, large retail centers and drugstores. Only Seattle’s Best coffees will be available in the kiosks, but higher-priced brews will be available for $1.50 a cup, The Wall Street Journal noted.

Kiosks will start appearing later this summer, and 500 should be in place by the end of 2012. If the program proves successful, more coffee flavors and cup sizes could be introduced, and possibly iced coffees, too.

Financial terms of the partnership were not revealed.

Best known for its coin-counting machines, Coinstar also produces Redbox DVD-rental machines.

Starbucks officials noted that food vending machines weren’t as popular in the U.S. as in other countries, but the company hoped to accelerate their acceptance in North America. Coinstar estimated that it could eventually place 15,000 such kiosks across the U.S.

Shares of Coinstar rose more than 3% in Wednesday morning trading, while Starbucks shares edged up a little more than 1%. Also this week, Starbucks announced a $100 million purchase of LaBoulange bakery[4] brand to bolster its baked-goods offerings both in its coffee shops and in grocery stores.

Endnotes:
  1. SBUX: http://studio-5.financialcontent.com/investplace/quote?Symbol=SBUX
  2. CSTR: http://studio-5.financialcontent.com/investplace/quote?Symbol=CSTR
  3. thousands of coffee-dispensing kiosks nationwide: http://online.wsj.com/article/SB10001424052702303830204577448831198953946.html
  4. $100 million purchase of LaBoulange bakery: http://investorplace.com/2012/06/starbucks-bakes-a-brilliant-move/

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