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In Latin America, the opportunities are equally as robust. Mexico is an economic environment where we have 400 stores. This year, we had a meeting in Beijing and Shanghai of parents of employees in China. You might ask, "Why would you do that?" We have to present ourselves in a way that is locally relevant, not only with customers, but with employees. In China the relationship that the parents have to the one child is very unique. We wanted to describe our relationship as a company to the parents so they understood what we stand for, what we're trying to do.
Q: You raised some prices in June. What could we expect for the fall? is the price of a cup of coffee going up?
A: We don't see any change in pricing at this point. Pricing is a fragile issue in terms of the cost side. There are many things costing us less today than two or three years ago, coffee being one of them. But you look at dairy, and other commodity prices, transportation, the variable cost of doing business in America today, it's very erratic. This is what drives that.
Q: What are you doing in expansion in food, whether Danone yogurt or tea and healthy options?
A: We've made the strategic decision that we had an obligation to provide healthier food-and-beverage products. The acquisition of (Evolution Fresh) was the first in a series of strategic moves to do that.
We started feeling that this category, given the Greek yogurt craze domestically and around the world, was an opportunity for us. When we sat down with Danone, we recognized we had shared values and we could do something together. We will be creating a special Greek yogurt with Danone that will go into Starbucks parfaits in the spring. Then there will be a line of Danone Starbucks products. But it'll be branded Evolution, inspired by Danone, in every supermarket in America. Then we can leverage the flywheel of social and digital media to do all the things that we can do to create awareness and then deliver that in grocery.
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