High-margin business
Quaint London Costa
Coming here?
Coca-Cola has purchased the coffee brand Costa Coffee and has positioned itself to cash in on the stimulating market of high-margin lattes and pre-paid cards. That’s where customers fork over millions of dollars for coffee that they intend to buy — someday. What a deal. Anyway, Costa is a growing name in the UK and China. The price was $5.1 billion US. There is much speculation Coke will be launching storefronts to compete with Starbucks, Tim’s and McCafe. The coffee business is hugely profitable. In additon to getting many customers to pay months in advance for coffee, the margin on most Starbucks products achieves or exceeds 100 percent. Yes sir, that’s business.
- Coffee-card customers make $1.4 billion loan to Starbucks
- Coca-Cola buys one of the world’s largest coffee chains for $5.1 bln
- Coke brews an instant coffee rivalry with $5.1 billion Costa buy
