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Friday, June 26, 2009
Alyce Lomax :: Townhall.com Columnist
Does Starbucks Need a Facelift?
by Alyce Lomax
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It's no secret that Starbucks (Nasdaq: SBUX) has been more into shuttering shops than opening new ones here lately, but it does have one interesting initiative up its sleeve, and that's giving some stores individualized, eco-friendly facelifts as well as seeking some additional green credentials.

According to The Seattle Times, Starbucks' plan is to use local and environmentally friendly materials that bring to mind the particular neighborhoods where the stores are located. Examples so far include its store across from Seattle's Pike Place Market, which has a coffee bar that utilizes scrap leather from shoe and automobile factories as well as cabinets made from fallen trees in Seattle.

In addition, Starbucks plans to seek LEED (Leadership in Energy and Environmental Design) certification for all of its new company-owned stores beginning next year. (I recently wrote about how McDonald's (NYSE: MCD) received the platinum-level LEED award for its headquarters, in fact -- talk about surprising green shoots from big blue-chip companies.)

I've always thought Starbucks did a fairly good job of having some degree of variety and distinction in its stores, but this plan does sound like a greater step in the spirit of "uniqueness," which would be important as Starbucks seeks to retain its differentiation. This sense of differentiation is arguably an important concern, since Starbucks has been doing an awful lot of things lately that might remind one just a wee bit too much of Mickey D's and could possibly tarnish its brand.

The LEED certification is interesting, though, and gives me pause; Starbucks has always given off an air of green and sustainability, so it seems a bit odd that it doesn't appear to have gone for this particular initiative till now (a time when store openings are not a major part of its plans!).

Whole Foods Market (Nasdaq: WFMI) has long focused on such initiatives, having received the Environmental Protection Agency's Green Power awards for four years; its flagship store and several others are LEED-certified, and according to its most recent Form 10-K, it has about 20 stores registered to become LEED-certified.

Personally, I think anything Starbucks can do to continue differentiating itself from rivals like McDonald's, Dunkin' Donuts, Caribou (Nasdaq: CBOU), and Peet's (Nasdaq: PEET) is a good idea, and an emphasis on the LEED certifications seems like a good move, too, as more and more consumers like the idea of green building. Feel free to share your own views in the comment boxes below, though -- will such moves help Starbucks, or do they sound like a waste of precious time and money?

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About The Author

Alyce Lomax is a contributor to the Motley Fool.

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