COMPETITIVE WATCH: Starbucks Goes Back to the Grind

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COMPETITIVE WATCH: Starbucks Goes Back to the Grind

SEATTLE -- Smelling the coffee will be easier for Starbucks customers, as the coffeehouse chain will again freshly grind and scoop coffee at its U.S. company-owned stores by mid-August, so they smell like coffee again, USA Today reported.

Starbucks CEO Howard Schultz was expected to announce the change—along with several other initiatives, including social networking, a loyalty program and more—at yesterday's annual meeting here.

Schultz told USA Today a key first step to return Starbucks to successful times, is grinding beans for brewed coffee, reversing the switch to sealed bags of preground coffee. Upcoming changes will include new ways to make and sell coffee, new products and redesigned stores, according to the report.

Among other plans: coffee will be made in smaller batches, and permitted holding time will be cut.

"We'll spill out more coffee than most coffee shops sell," he told the paper. "You won't be able to find a fresher cup of coffee on the planet."

Schultz attributed the troubles not to the economy, but to Starbucks itself. "The problems we are facing have been self-induced. That's why I think we'll be able to fix them," he told the paper.

"We're going to elevate the experience to new heights and new levels, the likes of which Starbucks customers have never seen before," Schultz said. "This is the beginning of transforming the Starbucks experience."

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