New York – If it has Oprah’s name on it, it is bound for success; but since January when Starbucks started carrying Teavana’s Oprah Chai, along with nine other flavors, many stores have not been able to keep the teas in stock.
Starbucks, which has almost 22,000 stores in 66 countries, previously blamed the shortage on problems at the ports, but now a company spokesperson is saying it is just because of the transition from their former marquis tea brand Tazo.
“We are experiencing slower than usual replenishment, but we are in the process of replenishing our teas, and apologize to customers for any inconvenience,” said Alisa Martinez, a Starbucks spokesperson.
Since the switch from Tazo to Teavana this year, store managers in Manhattan say a lot of tea bags have also been going to waste because they have simply been breaking.
“They are different than the Tazo tea bags and are a little more delicate, so baristas are getting used to how to open them, and there could have been some tearing associated with that,” said Martinez.
Store managers echoed the spokesperson saying fewer bags have been breaking in recent weeks, but it is still a problem.
One manager went on to say the teas have been more popular than they anticipated, and they have gotten countless complaints because of the shortages.
Starbucks claims they are expediting shipments as quickly as possible, but would not give a specific date for when the shortage would be over.
The switch to Teavana comes at a crucial time, as the market for tea drinkers has skyrocketed in recent years.
Worldwide, tea is the most widely consumed beverage next to water, and according to the U.S. Tea Association, the U.S market for tea has more than quadrupled in the past two decades.
YouGov’s latest research shows it is a millennial problem. In 1946 the average American drank nearly 46 gallons of coffee a year. In 2013 it was down to 23 gallons. YouGov found coffee is still a favorite among older Americans, but for those under 30, coffee and tea and equally popular.
Starbucks has sold tea since it was founded in 1971. The company bought Teavana in 2012 for $620 million, nearly 77 times the amount of money it spent when it acquired Tazo in 1999. Tazo sold for $8.1 million.
Starbucks still owns Tazo tea, which will primarily be sold in grocery stores now. Starbucks said in 2012 that the business brought in more than $1 billion in annual sales.
Prior to the switch from Tazo to Teavana in stores, Starbucks reported a record-breaking increase of 13 percent in net revenues last quarter, which would include holiday sales. Consolidated net revenues came in at $4.8 billion.
Coffee remains the breadwinner for Starbucks in the U.S., but tea as a percentage of retail sales has been increasing. Starbucks said tea has accounted for 10 percent in recent quarters.
This month Starbucks is also getting a new chief operating officer. Troy Alstead, who has been with the company for 23 years, is taking extended unpaid leave to spend more time with his family.
Kevin Johnson, a board member since 2009, will take the helm of the central operating role starting March 1.
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