21 November 2018 | US

Coca-Cola won’t go ‘head-to-head’ with Starbucks says CEO James Quincey

Coca-Cola boss, James Quincey, says his firm does not intend to compete directly Starbucks stores following the $5.1bn acquisition Costa Coffee


In an interview with CNBC, Quincey said bricks-and-mortar coffee shops would form part of a diverse coffee offer from Coca-Cola. He cited ready-to-drink (RTD) products and coffee vending machines as a potentially bigger pieces of the total coffee market, we he valued at roughly $500m.

"The biggest piece is in immediate consumption channels. And, actually, while coffee shops exist, the biggest piece is the rest,” he said. “Our idea is not to go head to head,” he added, commenting on the potential for a clash with coffee Titan, Starbucks, which signed $7.1bn distribution deal with Nestlé in May 2018.

In particular, Quincey singled out the potential for ‘store-within-store’ concepts, including expanding Costa Coffee’s presence in cinemas and service stations via kiosks and vending machines, the latter of which Costa Coffee already operates some 8,000 globally.

Quincey’s comments will fuel speculation as to which direction the $213bn beverage giant will take Costa Coffee’s 4,000 international store portfolio. Following the acquisition, which is still subject to regulatory approval, Quincey has previously stated Coca-Cola wants to run Costa as a ‘connected but not integrated' business.
 

 
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