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Starbucks Corp. -- the world's largest chain of coffee shops -- will introduce at least one new drink each season to attract new consumers and increase sales, the company's Chief Executive Officer Jim Donald told Bloomberg News during a recent interview.
Drink flavors are developed as much as one year in advance of their debut, Donald said, adding that a new tropical-inspired drink will go on sale this month.
"We're going to launch a new beverage every season," he said. "The trend right now, you'll see … is flavor-related. It's light. It's airy. It's tropical with regard to seasonal fruity beverages.”
Donald said the new drinks will be both hot and cold.
Starbucks' long-term plan is to triple its number of stores to 30,000 and it is attracting new consumers by creating drinks such as green tea Frappuccino and marble mocha macchiato, and selling CDs and DVDs to expand sales beyond coffee, the report said.
The chain has added such drinks as the cinnamon dulce latte and Rwanda Blue Bourbon Coffee. The company also introduced a ready-to-drink beverage called Starbucks Iced Coffee that will be distributed by PepsiCo Inc., which already manufactures and distributes its Frappuccino and DoubleShot beverages, according to Bloomberg News .
Starbucks is facing increased competition from companies such as Canadian doughnut chain Tim Hortons Inc., which in March did an initial public offering on the New York Stock Exchange. The company plans to double its locations in the U.S. to 500 stores, the report said.
Dunkin' Donuts was bought last year by Bain Capital LLC and two investment firms for $2.43 billion so the chain can reportedly add stores and compete with Starbucks. It has 4,400 stores in the U.S. and gets half of its sales from coffee.
Donald told Bloomberg News that today any competition in the coffee chain category "bodes well for them and bodes well for us, too" because it expands sales of coffee.
Starbucks has opened 984 new stores so far this fiscal year. The company plans to open about 900 more by the end of the year. Starbucks will continue to reach its long-term target of increasing monthly sales by 3 percent to 7 percent, Donald said in the interview.