Starbucks has agreed to sell Seattle’s Best Coffee, the crosstown rival brand it acquired nearly two decades ago, to Nestle, the companies said on Wednesday.
Or what’s left of it, anyway. Seattle’s Best is purely a retail brand at this point in its history. The sale comes as Starbucks sheds brands that stray too far from its core concept.
“We’re confident that Nestle will continue to grow the Seattle’s Best Coffee brand as we focus on our strategy to elevate the premium coffee experience for consumers through the Starbucks brand,” said Michael Conway, group president of Starbucks International and Channel Development.
It also represents the end of a weird era. Seattle’s Best was founded in 1970 and in 2003 was owned by AFC Enterprises, the same company that owned the chicken chains Popeyes and Church’s. At the time, Seattle’s Best operated 129 corporate locations and franchised other units.
But it also had a growing wholesale business that AFC wanted nothing to do with. So, AFC sold the company to Starbucks for $72 million. International franchise rights for Seattle’s Best would later be sold to Focus Brands.
Starbucks for years operated Seattle’s Best as a secondary brand that was theoretically targeted at places where “premium coffee” wouldn’t otherwise work. The plan was to expand the concept in a variety of areas through franchising, licensing and in retail. Starbucks expected Seattle's Best to become a $1 billion global brand.
In 2005, Seattle’s Best reached a deal to locate its concept inside Borders bookstores, only to be shuttered six years later after the now-defunct bookseller declared bankruptcy.
For a time, interestingly, Seattle’s Best was planned as a drive-thru-only concept, an idea that likely came and went a decade too early.
Seattle’s Best also found itself in other brands’ plans, such as Burger King, which added the coffee to its breakfast lineup as part of a comeback effort in 2010.
Over time, only that wholesale coffee business would remain. In 2018, Starbucks reached a deal with Nestle to form what the companies call a “Global Coffee Alliance,” in which Nestle would package and sell Starbucks’ various brands for retail consumption. That included Seattle’s Best.
These days, Starbucks is unloading non-core brands. Earlier this year, for instance, Starbucks sold the Evolution Fresh brand to the carrot-making company Bolthouse Farms.
Seattle’s Best hasn’t even been mentioned in a Starbucks earnings or news report in four years, since the Nestle deal was announced, not even as a footnote.
With little need to keep that brand any longer, Starbucks agreed to sell Seattle’s Best to Nestle for an undisclosed sum. The deal is expected to close by the end of the year. “With the well-known Seattle’s Best Coffee brand, we will continue to build our leadership in coffee by offering consumers more choice for their everyday coffee,” David Rennie, head of Nestle Coffee Brands, said in a statement.
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