Starbucks is about to start tests of its delivery system, which will likely be multi-pronged, according to executives, who were asked if the set up would mirror the hub-based system that Panera Bread Co. has described as its entry into the arena.
Panera already generates about $300 million—8 percent of sales—from the delivery of catered meals, or what the chain calls Large Order Delivery. CEO Ron Shaich revealed that the creation of “delivery hubs” to handle the large orders will provide an infrastructure “to ultimately serve the small-order delivery market.”
Nine delivery hubs, each serving one to three conventional Panera units, are already open, and 16 more are scheduled to fire up their ovens before Jan. 1.
Schaich pegged the potential sales of delivery, small and large order, at $1 billion for Panera.
Starbucks, meanwhile, is planning to add delivery service in some markets during the second half of 2015, CEO Howard Schultz revealed to financial analysts on Thursday.
Matt Ryan, Starbucks’ global chief strategy officer, offered few details about the initiative. “The pilots are coming soon,” he said. “We are going to be looking at a number of different options.” He suggested that the coffee chain might use several different systems to get coffee and food into consumers’ hands.
Ryan was specifically asked if Starbucks intended to develop a second network of facilities to provide delivery, but Ryan declined to say yes or no.
The potential for incremental sales has lured a number of chains to branch into delivery, including Burger King and Chili’s.