Starbucks Ditches CD’s: What Took So Long?

I thought this was a goner months ago?

Starbucks has perhaps realized it is not an entertainment company, but a coffee chain? By September, it is rumored the company will eliminate retail CDs sales in stores. Starbucks will offer just four CDs per store rather than the racks offering multiple CD choices customers currently there.

Starbucks says it was selling more than 4 million CDs a year. Now, if we divide it by the 14,000 location we get and average of 285 CDs per location or less than one a day. Why wasn’t this killed, oh maybe a year ago?

Now it isn’t clear if Starbucks is going to kill the whole division or not. It should. It is sucking resources and funds that ought to being put to better use. Maybe a dividend? Payoff some debt, now at $500 million vs less than $2 million a year ago? Maybe?

Over a year ago we first looked at this in a post and at least now they at least seem to be getting the point.

Now let’s not get all excited and run out and buy shares. Unless Starbucks axes the whole division, the move is just a drop in the bucket. At least if they nix it, we can then at least say they are getting things together. In now way does that constitute a reason to buy shares.

Far more needs to be done……….

Disclosure (“none” means no position):None