By Scott Moritz

Coca-Cola Bottling (COKE) the No.2 Coke distributor says it plans to cut 5%, or 350 workers, to help offset the rising costs of sweetener and diesel fuel. The Charlotte, N.C.-based bottler expects to take a charge between $4 million and $5 million to cover severance and other expenses.

The reorganization was first announced in a regulatory filing Tuesday and comes as the Atlanta soft drink giant Coca-Cola (KO) reported its global volume growth hit 3%, a low not hit in three years. Coke said Thursday it saw U.S. business challenging and outlined plans to raise prices.

Coca-Cola Bottling says it will offer severance packages to qualified employees and expects to complete the staff cuts by the end of September.

The Starbucks (SBUX) media blitz continues. The Seattle-based coffee chain reminded investors Friday that it and partner AT&T (T) would roll out WiFi wireless Internet service at company-owned stores nationwide this year. The companies say qualifying AT&T broadband customers will get free WiFi service in more than 7,000 U.S. Starbucks stores. Starbucks dropped T-Mobile for AT&T back in February.

“We continue to build on the experience we know our customers expect from us,” said Starbucks technology chief Chris Bruzzo. “By partnering with AT&T as our U.S. Wi-Fi provider we aim to deliver a better value, greater convenience and seamless connectivity in a mobility centric world to our customers.”

Starbucks has spent recent days emphasizing the many ways it makes its stores customer-friendly. The company yesterday said it was refining its “entertainment strategy,” by giving up day-to-day management of its record label and seeking out “ways to enhance the customer experience through the use of wi-fi and other in-store technology.”

But recent numbers suggest that what customers want at the moment is not a richer experience, but a cheaper one. On Wednesday, Starbucks set off a sharp decline in its shares by slashing 2008 earnings guidance, citing a sharp slowdown in consumer spending in markets such as California and Florida that have been hit hard by the housing slump. CEO Howard Schultz said that while customers are visiting Starbucks stores less often, company research shows “they are not substituting their Starbucks Experience with coffee products from others.” Unfortunately, that sort of loyalty isn’t doing anything for Starbucks’ bottom line right now.

The coffee wars are really heating up now. Starbucks (SBUX), under fire for the last year as rivals like McDonald’s (MCD) took aim at the expensive-coffee market, late Monday said Chairman Howard Schultz, who ran the company between 1987 and 2000, will return to grab the reins as CEO. He’ll replace Jim Donald, whose many stumbles included the inexplicable claim last year that he welcomed McDonald’s arrival in the market. In addition to putting Schultz back in charge, Starbucks is taking a page out of Wal-Mart’s (WMT) by slowing its U.S. store growth, and emulating McDonald’s by promising to put the customer first once again. The company says the changes will have the effect of “refocusing the company on providing customers with the distinctive Starbucks Experience [italics theirs] and building on Starbucks legacy of innovation.” With the stock up 7 percent late Monday, it’s hard to argue with the decision - even if providing customers a better experience will be more difficult than talking up the Starbucks Experience.