Coffee Retailer Ready To Roast N.Y. -- Upper West Side Gets Shop Tomorrow

New York's first Starbucks retail store is opening tomorrow on the Upper West Side, a diverse and lively neighborhood about as close as Manhattan gets to Seattle.

With two huge espresso bars and spacious seating, the 2,200-square-foot outlet is Starbucks' biggest store, said President and Chief Executive Howard Schultz. He said new technology and equipment will enable the store to provide the speedier service New Yorkers expect.

"We've never entered a market as densely populated as New York, and we've never had so many people come to our door prior to the opening of a store," said Schultz, a Brooklyn native.

Starbucks joins the lineup of specialty-coffee retailers and cafes springing up all over the city in the past few years. Several, including Coopers Coffee and Joe Bar, are within a few blocks of Starbucks' location at Broadway and 87th Street. Also nearby is Zabar's, a legendary New York purveyor of food and housewares, which does a brisk business in coffee beans.

The Starbucks product is already offered in three Daily Caffe coffee bars in midtown Manhattan. Daily Caffe was established in 1991 by former Seattleites Andrew Price and Todd Collins, who now works for Starbucks as a store opening specialist.

With Daily Caffe ensconced in prime office buildings in the Rockefeller Center area, Price isn't worried about Starbucks' direct entry into the market. He's an admirer of the company and a shareholder.

Although New Yorkers pride themselves on having the best of everything and having it first, they're a step behind Seattle and Boston as coffee connoisseurs. "The quality of coffee at the average espresso bar is very low," Price said. "Up until recently, people have paid a premium just to be in a coffee bar."

Price sees a growing level of coffee awareness. "I think with Starbucks and their marketing it will accelerate. When we started, people would go out of their way for a great cup of coffee. Now they don't have to."

Starbucks, with 317 stores nationwide and an ambitious agenda for New York, is acquiring The Coffee Connection, which launched the coffee cult in Boston with a milder trademark roast. The first Starbucks store in Boston and the first Coffee Connection store in New York state both opened this month.

Wayne Daniels, analyst for Wertheim Schroder & Co., said the New York market is ripe for growth. "There are very few competitors, and most are small. The population density will bring huge volumes and margins from the store," he said.

Naomi Talish, an analyst at Morgan Stanley & Co., said, "New York has been a good market for their mail order, which is a traditional indicator of a good retail market." She predicted Starbucks revenue will increase by two-thirds this year and 50 percent over five years.

Starbucks apparently shares analysts' expectations.

Schultz said the New York opening has been in the planning stages for about 18 months. "Our goal is to romance the beverage and differentiate it from anything already in New York. Our core business is getting customers to bring Starbucks coffee into their homes, and the beverage is a way to do that."

Collins, who honed his retailing skills at the Pike Place Market, agrees. "The West Coast thinks it's hard to go to the East Coast, that you can't find nice Seattle-like people here, but it's not true. New Yorkers love to be treated right and hang out a little," he said. "I don't think it will take long for them to get used to the Starbucks experience."

Gisela Moriarty is a free-lance business writer based in New York.