Starbucks Brings La Boulange East

The coffeehouse chain will add the bakery’s pastries to select New York and Boston locations, with further expansion put on hold until after the holidays.

September 25, 2013

BOSTON – Bostonians and New Yorkers are enjoying La Boulange pastries before the rest of the East Coast with the addition of the bakery’s items to select Starbucks Boston and New York City locations, Nation’s Restaurant News reports. The coffeehouse chain said the Boston and New York debut would mark the last of its 2013 La Boulange expansion until early 2014.

Currently, the pastries are available at around 3,200 locations, mostly on the West Coast and in Chicago. The new lineup of La Boulange savory and sweet breakfast items will roll out to around 7,000 Starbucks-owned stores across the country early next year, said spokeswoman Holly Shafer. In 2012, Starbucks bought the La Boulange bakery brand with an eye to expanding its food offerings at coffee shops.

Pascal Rigo, who started the bakery, has been working on the Starbucks food menu beginning with breakfast. He created classic French croissants, savory tarts with such fillings as ham and cheese, spinach and butternut squash, and mini loaves and muffins. Rigo is also tasked with revamping lunch, with new sandwiches, salads and soups being tested at some San Francisco units, but for now, breakfast is the focus.

Already, the introduction of the new pastry line has boosted sales at Chicago locations, according to an analysis by Sharon Zackfia of William Blair & Company LLC. She discovered that before La Boulange items were added, food buys only grabbed one out of three transactions nationally, with an average of around 19% of U.S. sales. At stores with La Boulange, food purchases bumped up to 25%. “Food could represent the single largest incremental driver of U.S. comps over the next few years,” said Zackfia.

The new bakery items also cost more, on average around 7% higher. “With our rough calculation suggesting every 5-percentage-point increase in food penetration equates to about 3 comp points, our analysis suggests that Chicago could be achieving a 4% to 5% comp lift on the La Boulange rollout, assuming peak morning hour results are replicable during the rest of the day,” she said.

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