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More than five years after launching a mobile-order and pick-up-only store format, Starbucks is abandoning the conceptand it signals a larger strategy for the coffee chain. Starbucks, which announced its sixth consecutive quarter of falling same-store sales on its earnings call Tuesday, opened its first mobile-only location in Manhattans Penn Plaza in 2019. The store concept centered on a speedy, transactional experience that required consumers to place orders and make payments in advance on their phones. These locations did not have any seating to encourage latte drinkers to stick around. In retrospect, the concept foreshadowed an era of mobile-first, quick-service restaurant designs in response to changing consumer habits due to the pandemic and the following economic inflation, and that’s often meant a de-emphasis on dining rooms. Chipotle’s digital-only restaurant and Chick-fil-A’s all-mobile pickup restaurant are two such examples. The idea behind the Starbucks mobile-only stores was well timed to the rise of contactless, takeout, and delivery fast-food options, but as Starbucks seeks to chart a comeback, the model no longer fits its strategy as it emphasizes its café experience. “We found this format to be overly transactional and lacking the warmth and human connection that defines our brand,” Starbucks CEO Brian Niccol said on the earnings call. Between 80 and 90 of these locations will close by next year, while some may be converted to traditional coffeehouses with seating. That doesn’t mean Starbucks is moving away from mobile ordering, which accounts for 31% of transactions. However, where the coffee shop has a physical presence, it wants to offer a setting in which guests can feel welcome. Niccol said a forthcoming prototype of a new small-footprint café will have a drive-through, room for 32 seats, and about 30% lower building costs. As Starbucks has brought back details like handwritten notes on coffee cups and an updated barista dress code, and it plans future store uplifts, a mobile-only storefront isn’t the brand experience the company is after anymore. It’s not just about the coffee; it’s about the coffee shop.
Category:
E-Commerce
A cryptocurrency working group formed by President Donald Trump is set to release a report on Wednesday that is expected to outline the administration’s stances on tokenization and market-defining crypto legislation, among other issues critically important to the digital asset industry. Shortly after taking office in January, Trump ordered the creation of a crypto working group tasked with proposing new regulations, making good on his campaign promise to overhaul U.S. crypto policy. Wednesday’s report is a culmination of the task force’s work so far and its first public findings. In line with Trump’s January executive order, it will lay out what rules and laws should be enacted to advance the policy goals of the pro-crypto White House. Those include making sure that the Securities and Exchange Commission has a framework in place for firms to offer blockchain-based stocks and bonds, according to one person familiar with the discussions. The report is also expected to discuss the administration’s wish list for legislation Congress is currently debating to create broad regulatory guidelines for cryptocurrency, according to a second person familiar with the report. The working group led by Trump official Bo Hines is composed of several administration officials including Treasury Secretary Scott Bessent, SEC Chair Paul Atkins and Director of the Office of Management and Budget Russell Vought. The White House, Treasury Department and the SEC did not immediately respond to requests for comment on the report. “While there have been regulatory regimes in place that have maybe been piecemeal or have allowed the industry to grow in certain ways, the recommendations that we expect to see in the report will be a good roadmap for how to build out crypto as a continued important part of the economy going forward,” said Rebecca Rettig, chief legal officer at crypto firm Jito Labs. On the campaign trail, Trump courted crypto cash by pledging to be a “crypto president” and promote the adoption of digital assets. That is in stark contrast to former President Joe Biden’s regulators which, in a bid to protect Americans from fraud and money laundering, cracked down on the industry. The Biden administration sued exchanges Coinbase, Binance and dozens more, alleging they were flouting U.S. laws. Trump’s SEC has since dropped those cases. Tokenization, stablecoins, market structure Industry participants will be looking closely at what the report says about tokenization, the process of turning financial assetssuch as bank deposits, stocks, bonds, funds and even real estateinto crypto assets. Crypto firms and others have been increasingly discussing the prospect of tokenizing securities as a new way to facilitate trading. Coinbase recently told Reuters it was seeking a U.S. green light from the SEC to offer blockchain-based stocks. The SEC has yet to weigh in publicly on that request. Wednesday’s report is expected to recognize the need for the SEC to develop a framework for tokenization, according to a source familiar with the discussions, but the details of the language were not immediately clear. The report will also lay out what the White House would like to see from market structure legislation working its way through Congress, according to a separate person with knowledge of the report. The House of Representatives passed a bill called the Clarity Act earlier this month that would create a formal regulatory regime for crypto, and the U.S. Senate is considering its own version of the measure. Earlier this month, Trump signed into law a bill to create federal rules for stablecoins, a type of cryptocurrency pegged to the U.S. dollar. That move was hailed as a major win for the digital asset industry, and the White House has said it wants Congress to pass market structure legislation next, which would have far wider repercussions for the industry. The crypto sector has for years argued that existing U.S. regulations are inappropriate for cryptocurrencies and has called for Congress and regulators to write new ones that clarify when a crypto token is a security, commodity or falls into another category, like stablecoins. The president’s support for the crypto industry has sparked conflict-of-interest concerns, which at times have threatened to derail congressional crypto legislation. Trump’s family has launched cryptocurrency meme coins, and the president also holds a stake in World Liberty Financial, a crypto platform. The White House has denied that any conflicts of interest are present. Hannah Lang, Reuters
Category:
E-Commerce
U.S. stock indexes are drifting on Wednesday after the Federal Reserve decided to keep interest rates where they are, a move that could upset President Donald Trump but that Wall Street was widely expecting. The S&P 500 was edging up by 0.2% in afternoon trading, coming off its first loss after setting all-time highs for six successive days. The Dow Jones Industrial Average was up 25 points, or 0.1%, as of 2:05 p.m. ET, and the Nasdaq composite was adding 0.4%. In the bond market, Treasury yields gave back some of their gains from the morning, when a report suggested the U.S. economys growth was much stronger during the spring than economists expected. It grew at a 3% annual rate, according to an advance estimate, a full percentage point more than forecast. But underlying trends beneath the surface may be more discouraging. Cutting through the noise of the swings in imports, the economy is still chugging along, but it is showing signs of sputtering, said Brian Jacobsen, chief economist at Annex Wealth Management. The data reinforced the dilemma facing Fed officials as they voted Wednesday on what to do with interest rates. They could have lowered rates, which would give a boost to the economy as Trump has been angrily calling for. But lower rates could also give inflation more fuel when Trumps tariffs may be set to increase prices for U.S. households. Trump on Wednesday announced a 25% tariff on imports coming from India, along with an additional tax because of India’s purchases of Russian oil, beginning on August 1. Thats when stiff tariffs Trump has proposed for many other countries are also scheduled to kick in, unless they reach trade deals that lower the rates. Fed Chair Jerome Powell has been insisting that he wants to see more data about how tariffs are affecting inflation and the economy before the central bank makes its next move, and he will speak shortly to offer more details about the decision. Two officials on the Fed committee did dissent in Wednesday’s vote, an indication that Powell may face increasing pressure to cut rates soon. Much of Wall Street expects the Fed to resume lowering rates in September. It’s been on hold this year after rates were cut several times late last year. The yield on the two-year U.S. Treasury note edged up to 3.87%, from 3.86% late Tuesday. It tends to closely follow expectations for what the Fed will do with its overnight interest rate. The 10-year Treasury, which also takes into account longer-term expectations for the economy and inflation, was holding at 4.34%. On Wall Street, stocks were mixed as most big U.S. companies continue to report profits for the spring that were bigger than analysts expected. Humana rose 10.3% after the insurer and healthcare giant reported stronger results for the spring than expected. It also raised its forecasts for profit and revenue over the full year. Video-game maker Electronic Arts climbed 7% after likewise topping Wall Street’s expectations. The company said it saw better-than-expected contributions from EA Sports and other games, and it will reveal its new Battlefield game on Thursday. Companies are under pressure to deliver solid profit growth. They need to in order to justify the big jumps in their stock prices during recent months, which have caused some critics to say the broad U.S. stock market looks too expensive. Trane Technologies, whose stock came into the day with a 27.5% gain for the year so far, tumbled even though it reported a stronger-than-expected profit for the latest quarter. The heating, ventilation, and air-conditioning company’s revenue came up short of analysts’ estimates, as did its forecast for profit in the current quarter. It dropped 8%. Starbucks swung between gains and losses after it reported a weaker profit than analysts expected, as it tries to turn around its operations. The company is hoping to boost its performance through improved store operations and new products, including a cold foam protein drink. Its stock was most recently up 0.4%. Palo Alto Networks fell 4.4% after saying it would buy CyberArk, an identity-security company, for $25 billion in cash and stock. CyberArk shares added 1.4%. In stock markets abroad, indexes were mixed across Europe and Asia. Hong Kongs Hang Seng fell 1.4%, and South Koreas Kospi rose 0.7%, in two of the bigger moves. By Stan Choe, AP business writer AP Business Writers Matt Ott and Elaine Kurtenbach contributed.
Category:
E-Commerce
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