Starbucks to start Record Label

Posted by: Grayson Brulte

“Having already proven that it can sell other companies’ music, coffee giant Starbucks is planning to launch its own record label and is close to a deal for the next album from former Beatle Sir Paul McCartney to be its first release, according to sources familiar with the plans.”

“Starbucks Records is expected sign, record and produce its own artists rather than licensing songs from other labels.”

This is great news for the Music Industry and the consumer. Now the Major Labels are going to have a major headache on their hands. Their is a new kid on the block who has the cash flow (operating cash flow of 1.20 Billion), licensing agreements, marketing genius and distribution channels (both traditional retail and digital) to push their artists. As the New York Post article says, look for an announcement this week.

According to StateMaster.com there are 8,229 Starbucks stores in the U.S. compared to 1,150 Best Buy Stores in the U.S., Canada and China (source). Starbucks has plans to expand the U.S Market to 15,000 stores making for a grand total of 30,000 stores around the world after expansion. With the new record label, is Starbucks going to be able to tap international artists and the international market? If done right, Starbucks could become the next major label.

Starbucks facts (Source)

25 million: the number of customers Starbucks attracts every week

18: the number of times the average customer drops in every month

Read the full article in today’s New York Post.