Starbucks tries to juice up its profits

Bob Strong / Reuters

Starbucks is ramping up the competition with juice bars like Jamba Juice. The coffee chain has purchased a juice company as part of a major push into the field.

From msnbc.com wire reports

Starbucks Corp. hopes to do for juice what it's done for coffee.

Starbucks, which changed the way Americans drink coffee, acquired juice maker Evolution Fresh Inc. for $30 million as part of a larger effort to move beyond coffee and focus on health and wellness.

The Seattle-based coffee giant said Thursday that it plans to "reinvent" the $1.6 billion super-premium juice segment with its acquisition of Evolution, which is based in San Bernadino, Calif. It plans to open new health and wellness stores in the coming year, although it did not disclose how many of these stores it will open, their location or the name.

Starbucks CEO Howard Schultz said the moves were the first of many things the company planned for the so-called health and wellness market.

"We think we can build a major business," he told reporters on a conference call.

Starbucks said the stores will emphasize Evolution juice and carry wholesome, simple foods. The company also plans to upgrade some of its existing stores to make room for the Evolution products and plans to distribute Evolution's products to other retailers.

Evolution, started by the founder of Naked juice, makes fresh fruit and vegetable juices. Its products are currently sold at Whole Foods, Safeway, Costco and other select retailers on the West Coast.

Starbucks said the acquisition is part of a larger shift of its business to focus on health and wellness. The company has made several changes to its business to reflect consumer demands for healthier products such as introducing lower-calorie and lower-fat food options, sugar-free syrups and switching from whole milk to 2 percent milk as the default in its drinks a few years ago.

Shares of the company rose 58 cents to $43.53 in afternoon trading.?

Associated Press and Reuters contributed to this report.

Source: http://bottomline.msnbc.msn.com/_news/2011/11/10/8740389-starbucks-tries-to-juice-up-profits

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