Consumer Business Recap: Staples Gross Violation, Starbucks Announcement

Starbucks (NASDAQ:SBUX) had major news to report at a webcast UBS conference. Despite the introduction of its own brewer, Verismo, the company will offer Green Mountain Coffee’s (NASDAQ:GMCR) Keurig brewer and K-Cups in its own stores later in 2012. Accordingly, Green Mountain’s shares rose Wednesday on this announcement. Further, Starbucks remains confident that it will reach its goal of 1,500 stores in China by 2015. The coffee giant also sees costs of its prime ingredient falling in the latter half of this year.

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The FDA found ‘unsanitary conditions’ in a Staples (NASDAQ:SPLS) facility in which food products are stored, and accordingly has sent the company a warning letter concerning the matter.

Ron Johnson’s strategy of J.C. Penney (NYSE:JCP) reinventing itself has had investors eagerly jumping in, but Deutsche Bank analyst Charles Grom is killing the buzz somewhat, by remarking that the makeover ‘has led to customer confusion and lower traffic, instead of turbo-charging sales’.

Wal-Mart’s (NYSE:WMT) DVD conversion service gets dissed by Janney’s David Strasser, who calls it ‘potentially disruptive’. Claiming that Wal-Mart is becoming “creative and aggressive online”, Strasser at the same time opines that the market will ignore the service, with possible dismissals such as, “It’s WMT, that dinosaur … What could they really know, or how impactful can they really be?”

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To contact the reporter on this story: Mark Lawson at

To contact the editor responsible for this story: Damien Hoffman at