While the Company selectively locates stores in suburban malls, its focus is on stores that are convenient for pedestrian street traffic. .
As part of its expansion strategy of clustering stores in existing markets, Starbucks has experienced a certain amount of cannibalization of existing stores by new stores as the store concentration has increased, but management believes such cannibalization has been justified by the incremental sales and return on new store investment. The Company anticipates that this cannibalization, as well as increased competition and other factors may continue to put downward pressure on its comparable stores sales growth in future periods. .
The Company combines its merchandising strategy with its marketing programs to create and reinforce a distinctive brand image for its coffees. The Company's merchandising strategy is reflected in its product mix, product pricing, and sales and educational materials. The product mix in each store varies and depends on the size of the store and its location. Larger stores carry a revolving selection that can include any of the Company's more than 50 varieties of whole bean coffees and a range of coffee related products, including exclusive, high-quality coffee-making equipment as well as accessories bearing various Company trademarks, such as coffee mugs, coffee grinders, storage containers, coffee filters, and finely packaged gourmet food products. The smaller stores and kiosks usually sell a full line of coffee beverages, a limited selection of whole bean coffees and a few hardware items, mostly logo mugs and small equipment items. .
Starbucks prices its coffees competitively with the prevailing high-end coffee prices, reflecting the high-quality of the Company's coffees and its high level of customer service. Prices vary by market, including Canada, but as expressed in U. S. dollars, coffee beverage prices range from $0.
