Coffee chain Starbucks (SBUX) is in a precarious position.
While the coffee giant clocked over $8 billion in revenue at the start of the year it also warned that extraordinary cost pressures will continue to impact margins.
"High inflation, Covid-related pay, and training and onboarding of new partners impacted our profitability to approximately the same degree, even while customer demand remained strong," said Starbucks President and Chief Executive Kevin Johnson said during the fiscal-first quarter earnings call.
At a time like this a temporary closure of its cafe at a premium high footfall location like Disney's (DIS) iconic theme park Epcot may not be ideal for the beverage giant.
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No Starbucks With Your Disney Rides
A shop-in-shop version of Starbucks at Epcot's Traveler's Cafe shut down at one of Disney's largest theme parks on April 18 in Orlando, Fla., as it undergoes renovation, upgrades, and other structural changes.
Later this summer, Disney will debut an innovative new roller coaster called Guardians of the Galaxy: Cosmic Rewind at Epcot, the company said.
Epcot originally stood for “Experimental Prototype Community of Tomorrow.” To be sure, Epcot is also home to artisanal coffee brand Joffrey's at multiple locations.
Customers have found words of affirmation for the Starbucks Epcot staff and service.
While others on social media had more quirky reactions as record inflation rips through American households. "Yes it is possible to leave without an expensive cup of Starbucks coffee," tweeted Geneme.
But the closure may not be forever as Disney will open a new in-park dining area called Connection's Cafe and Starbucks is reportedly set to return with it. The new cafe is expected to open later this spring.
"There's been a fundamental shift in some of the operational processes that the parks had used for many, many years. And things like the ability to do mobile dining or not having to check in with a human being at a hotel. Those kinds of things are all things that add to some upside that we have at the parks," said Disney Chief Financial Officer and Senior Executive Vice President Christine McCarthy in February.
Disney now offers paid digital services like Genie + and Lightning Lane to customize food, beverage, and arrival times.
Disney and Starbucks Have a Lot in Common
Parks and rides, resorts, restaurants, and golf courses at Disney have had a Starbucks connection for over a decade
In April 2012, Starbucks said it would open six cafes at all Disney theme parks at Disneyland Resort in Anaheim, Calif., and Walt Disney World Resort in Lake Buena Vista, Fla.
“Starbucks and Disney have many things in common,” said Starbucks President for Global Development Arthur Rubinfeld, said in a past statement at the time the deal was announced.
The coffee and beverage giant had also launched a store at Disney Village at Disneyland Paris in June 2009, which became a popular destination for visitors. It has multiple locations at the Disney Springs shopping area in Orlando.
"Many of our guests have shared their passion for Starbucks with us, and we look forward to making their feedback a reality as we debut the first location at Disney California Adventure.” said Disney Vice President for Food and Beverage Maribeth Bisienere at April 2012.
