They're gonna have to stack 'em...

Oh joyous day!

Starbucks wants to triple its locations

It was such a burden having to walk at least 20 feet to get my next $4.00 coffee or ridiculous "world music" CD complilation.

The long-term plan is to have about 25,000 stores worldwide -- more than triple the nearly 8,000 stores the coffee retailer has right now. And even that amount seems a little "light," according to Starbucks chairman Howard Schultz.

I don't actually have anything against Starbucks, per se, but when you're already a symbol of the excesses of globalism, wouldn't you want to be a bit less conspicuous in your expansion? I mean, after there's one literally on every block, won't you just feel silly?

Comments

[Moe Lane]

Phase 2 must be just around the corner, then. :)

Moe

PS: Hey, I smile now, but when I first read that there was just the faintest hint of apprehension. Just a touch.

[SDAI-Tech1]

For questionable reasons a lot of CEO's make this sort of mistake. They believe (or suggest) that their company's current success is sustainable at an even larger scale. They expend a lot in new locations and generate a whole bunch of expenses and then they don't do as well.

Suddenly they panic, cut the wages to all their employees at the bottom of the food chain and find themselves with a whole bunch of money drains that aren't profitable or as viable as some farmed out market survey suggested.

What happens then when they start closing Starbucks? Image perception difficulties as something associated with being trendy assumes a "loser" stigma. Sales drop further when having a Starbuck's coffee goes the way of Haagen Daz and Ben & Jerry's.

Instead of making your shareholders money, you have tapped the profits, taken a healthy 8-figure bonus and sold off most of your stock clandestinely for the six months preceding the fall. The company becomes just another one fighting for survival circa 2012.

You don't care - after all you're wealthier than Midas on shareholder money (when the stock price rises on plans of expansion that's when you take your big, fat slice) and then after you have sold those folks down the river and have retired, you let some new hired fall guy ceo or chairman take the rap.

I see it happening around me all the time, and being a conservative doesn't make it any less reprehensible.

SDAI-Tech1

[Saint Fnordius]

Starbuck's is suffering from hubris, that's for sure. Their first attempt to enter the European market? Vienna, of all places, the city famous for its cafés. They quickly closed to to a lack of customers.

The next effort? Paris, of all places! Granted, Paris might have enough American tourists that don't like the petit noir in the morning, but it's still not exactly compatible to French lifestyle.

Germany is also extremely hostile territory, as is Italy. Why buy a pseudo-Italian coffee when every trattoria and has a modern espresso machine?

[nagoya ryan]

But it doesn't have that "raw sewage" taste, like Tweek's coffee.

[Navy Davy]

I hate Starbucks. In fact, just to spite Starbucks, I haven't had a cup of coffee in like 8 years. Makes you grumpy, but it be worth it.

On my short jaunt from the bus depot to the office (about 3 blocks) in downtown S.F., I counted 6 Starbucks shops.

It's worse than a Communist invasion.

[Edward]

I haven't had a cup of coffee in like 8 years

Well THAT explains a lot. : )

[engineer_charley]

We're kinda funny about this sort of success, aren't we? I mean, here's a capitalist success story, embodiment of the American dream, nobody's forcing you to drink their coffee (I am repelled by the stink, myself, and perfer to stand outside while my wife indulges), and yet we're all indignant about it. What is this, envy? Sure, some local coffee shops are driven out of business. Is that Starbucks' fault? Are they practicing illegal tactics (and, if so, what's up with companies from the Seattle area anyway, with their global domination bit)?

You don't like it, fine, don't spend your money there. That's the market, baby. But I don't see them makin' money off the backs of the little people, or any other demonic portrayal you can think of. They had a good idea and made it work. Are you tired of 'em? Okay, the tide will turn. Take heart in the fact that microbreweries are going strong and the American populace, in some regard, is showing an increasingly discerning taste. Offer a different, perhaps better, product at a competitive price, and you too can reap the rewards.

It's their money. They earned it. If they can expand, I say power to 'em. It's an economic engine.

Here's a question: what's the diff between Starbucks now and (say) McDonalds way back when? I wonder if McD's incurred the same sort of wrathful gnashing of teeth when it was burgeoning. Does anybody gripe about McDonalds now? I don't frequent either establishment (don't like coffee, and prefer more upscale chow), but I don't despair of their success, either.

[engineer_charley]

Now, if every place that sells coffee becomes a Starbucks, and every restaurant is a Taco Bell, then we really have descended to the innermost ring....

[EDG]

Charley, McDonald's still incurs that kind of wrathful gnashing, albeit on a more local level; in my (rural) area, plans to erect a McDonald's restaurant next to the local grocery store were met by a public outcry that really had to be seen to be believed. I had no idea so many people lived in my area.

Of course, to an extent, most large companies also receive this reaction when they're expanding - and, frankly, their occasionally underhanded tactics don't help matters whatsoever. About a decade ago UPS bought a chunk of land on one of the major roads in my (again, rural) area. There was another enormous outcry when this was discovered, but UPS assured everyone that the function of the place was just going to be a minor administrative center - and then, after they had the community's agreement for the administrative center, turned around and "changed their plans", building a relatively major distribution hub using a loophole in the permit and not actually informing the community until the trucks started rolling in.

[engineer_charley]

Right, I have no sympathy for illegal, or even underhanded, tactics. Being a good member of the community should be something that the corporate entity takes into consideration. If the end is to make money and create a sustainable business, it behooves the company to engender goodwill. No argument there. And to some degree, one has to wonder how considerate Starbucks is being. BTW, what was the beef (sorry) w/ McDs in your area? Because it was in competition with the grocery store?

I restrict my earlier comment to the observation that some appear to decry the arrival of yet more franchises based solely on the argument that Starbucks is successful enough, so they should knock it off. As a matter of epicurian, even cultural, diversity, I can understand this, but on an economic, capitalistic level, I say "why not?" in the absence of corporate malfeasance. I mean, "worse than a communist invasion?" Funny, but telling.

I've also not made a case study of Starbucks and whether expanding makes good business sense, or what it will do to their base of goodwill. If this thread is any indication, it won't help.