5 Blueprints For Starbucks Slowdown

Starbucks wants less hastily poured coffee and a better atmosphere, but others have tried.
Author:
Publish date:

SEATTLE (TheStreet) -- Slow steams on soy lattes? Baristas serving wine and beer? Cheeses served on China? Sorry, Starbucks (SBUX) - Get Report, but we've seen this before.

Every so often, a restaurant or fast-food provider gets just a little uncomfortable in its own skin and decides to branch out.

Yum Brands'

(YUM) - Get Report

Kentucky Fried Chicken fell so far out of love with its key product that it reduced itself to an acronym and, later, got itself into trouble with subsidiaries for pushing grilled chicken. Dunkin' Donuts broke from its "You-think-you're-better-than-me" mold of socioeconomic marketing to make lattes it once disdained. Now Starbucks is slowing things down for the sake of quality.

Starbucks is asking its baristas to slow down, bringing the coffee chain a step back toward its origins.

According to The Wall Street Journal, Starbucks wants its baristas to run their counters less like an assembly line and more like, you know, a cafe. That means preparing a maximum of two drinks at a time, steaming a drink's worth of milk at a time instead of a whole pitcher, cleaning out the pitcher between uses and staying at the espresso bar the whole time. That's a step back toward the original, earthy comforts Starbucks enjoyed back on Pike Place ages ago, but a big step away from the efficient commuter caffeine-dealing organization it's become.

Meanwhile, the espresso empire is tweaking the in-store formula by giving several locations a cafe look that places patrons at a bar around the barista, serving them wine, beer and cheese and co-opting the feel of some of the independent coffeehouses it's helped push to the margins over the years. The downside is that some drinks take twice as long to make and the lines are longer.

But so what? Americans

love

change and have no problem sacrificing speed for quality and aesthetics ... at least when its convenient to them. For Starbucks' consideration,

TheStreet

has compiled five examples of chains that went from fast-paced offerings to a more deliberate dining experience. Here's how they fared:

Burger King

(BKC)

Loud, mismatched colors were worn in public, Kurt Cobain was still alive and MTV was just beginning to play something other than videos when Burger King launched table service back in 1992. The Home of the Whopper's plan was to make its restaurants a bit more homey by letting customers order "dinner baskets" of fried chicken, steak sandwiches, meatloaf sandwiches, breaded shrimp or a Whopper with a baked potato or fries and cole slaw or salad.

Waitstaff would bring it to the table four to eight minutes later and, hopefully, transform every Burger King in America into a small-town diner. An idea this folksy and down-home could only be conveyed through one spokesman:

Yep, the face of MTV's pre-Jackass, super-extreme show for the hyperactive viewer age 25 and younger: MTV Sports host Dan Cortese. In just the kind of schizophrenic campaign you'd expect from a fast-food restaurant trying to be Cracker Barrel or any other slow-comfort chain, "BK TeeVee" featured jump cuts and shaky footage of Cortese frenetically extolling the virtues of getting "popcorn, just to chill with" while waiting twice as long for a Whopper as the guy at the drive-thru. While Cortese can still be seen in the occasional

Seinfeld

rerun as Elaine's "male bimbo" boyfriend and George's extreme-sports man-crush Tony, BK table service had a shelf life of less than a year.

Wendy's

(WEN) - Get Report

To understand why Wendy's would want to turn its restaurants into a giant salad bar is to understand 1980s restaurant-chain culture. In that zeitgeist, the salad bar was an exotic look at the restaurant of the future and not the parasite petri dish and bad-deli bacteria factory it is today. Salad bars ballooned into full-blown buffets and outlets such as Sizzler, Golden Corral and Ponderosa Steakhouse has seized the public's imagination. Wendy's felt it had to do something, so it created this:

By expanding facilities and setting up a SuperBar of Italian offerings such as pizza and garlic bread at one station, Mexican staples such as tacos and burritos at another and tubs of wilted lettuce, cherry tomatoes, pudding and gelatin at its third "salad" station, Wendy's was just giving the go-go '80s customers what they wanted. This fast-food franchise's stint as a sit-down buffet was brief, however, as high maintenance costs and pesky health codes made the SuperBar unsustainable.

Wendy's brief fixation on healthier eating through salads, improved sides and chicken and "frescatta" cold-cut sandwiches dealt the SuperBar its final blow. Its spirit lives on in the 980-calorie Baconator, as Wendy's continues to give the customer what it wants -- just faster.

McDonald's

(MCD) - Get Report

Don't let the McCafe offerings, fireplaces and televisions fool you -- McDonald's newfound coffee consciousness isn't slowing things down beneath the golden arches. Its brief ownership of

Chipotle Mexican Grill

(CMG) - Get Report

and Boston Market may be a big reason for that.

It wasn't that the ventures were unsuccessful when McDonald's sold the companies in 2006. McDonald's brought Boston Market out of bankruptcy after it overexpanded following an extremely successful IPO during its Boston Chicken days. Meanwhile, Chipotle grew from 16 locations in 1998 to more than 500 by the time McDonald's sold the company. Chipotle is still surging, becoming Technomic's ninth-fastest-growing company of 2009 and expanding to more than 1,000 locations today.That's lovely for Boston Market and Chipotle, but it wasn't so nice for McDonald's when the two were still under its auspices. While McDonald's benefited from buying both chains -- the Chipotle purchase alone made McDonald's $1.5 billion on a $360 million investment -- it determined that slowing down for some burritos and rotisserie chicken put its own offerings on the fast track to irrelevance. McCafe items including coffee and smoothies and a reinvestment in infrastructure are just part of the reason McDonald's third-quarter profit rose 10%, and its share price has increased nearly 38% in five years. Ronald's not slowing down for anyone.

Panera

(PNRA)

There's a reason Starbucks thinks it can slow things down without taking a loss: It's called Panera Bread. The bakery/cafe has put a near monopoly on the term fast-casual by sticking to its St. Louis Bread Co. formula of sandwiches, soups and pastries made with fresh ingredients and served in the time it takes to settle in with a cup of coffee.

Panera hasn't seen its market presence expand to nearly 1,400 shops and its share price more than double since 2008 by accident. It's done so by taking a page out of Starbucks' old playbook: Give the customer comforts you can provide on a consistent basis, make contributions to the causes they love and let them bring in their computers and stay for another cup or croissant. The company was sued in 2006 by a pension trust for not expanding and generating profits quickly enough and, earlier this year, experimented with a pay-what-you-can system in its St. Louis locations.

Panera is everything Starbucks professes itself to be, but abandoned when cranking out carmel macchiatos and Via instant coffees to compete with Dunkin' Donuts Coolatas and McDonald's McCafe mochas became its cause celebre. While Starbucks still supports causes and seems earnest about being a cafe again, its inconsistency could be cured with a visit to the big bakery down the block.

Cosi

(COSI)

Speaking of inconsistency, perhaps no chain has shifted from fast to slow and back again quite as often as Cosi. First it wanted to be a French cafe full of fresh ingredients and flavorful sandwiches. Then it wanted to be a quick-serve Starbucks-style espresso bar. Then it wanted to wow customers as a bakery by making its bread over an open flame.

Now it's all of these things, yet none of them. Briefly after it bought the XandO cafe chain in the late 1990s, Cosi was a place where you could get some wine and s'mores without spending much. Today, it's that place six minutes from the office that will have your chicken tinga flatbread sandwich ready after you order it online. Cosi's posted losses for the better part of the past three years; its stock price is just over $1 after trading at $10 five years ago; its brass have shuttered more than 100 of its locations since 2008; and it still has no idea what it wants to be.

Starbucks may never struggle as mightily as Cosi, but the latter's slide into obscurity makes an inconsistent fast-casual cafe seem like a slow road to ruin.

-- Written by Jason Notte in Boston.

>To contact the writer of this article, click here:

Jason Notte

.

>To follow the writer on Twitter, go to

http://twitter.com/notteham

.

>To submit a news tip, send an email to:

tips@thestreet.com

.

RELATED STORIES:

>>Starbucks Price Hike Shifts Coffee War

>>Neither McDonald's, Starbucks Win Coffee War

>>7 Best Sandwiches You'll Want Next

Follow TheStreet.com on

Twitter

and become a fan on

Facebook.

Jason Notte is a reporter for TheStreet.com. His writing has appeared in The New York Times, The Huffington Post, Esquire.com, Time Out New York, the Boston Herald, The Boston Phoenix, Metro newspaper and the Colorado Springs Independent.