The news that 600 Starbucks stores will be closing soon has been met with much shock and awe. How could such a successful company be met with such hard times? Well, it makes total sense. They expanded way too fast; in some cities, a Starbucks is literally on every corner. Is that really necessary? I think the product should bring people in; not the ultimate convenience. When a new Starbucks opens, it often eats into 25-30% of the sales of a nearby Starbucks. That is no way to operate a business. Company executives must have seen this coming for a long time. You can't sustain such growth patterns. This means that the profit margins of stores decrease while you see a great increase in expenses caused by the rapid expansion. It will be good for the company to go back to the basics, cool down a little bit, and stopping eating itself.
Subscribe to:
Post Comments (Atom)
Korea - Land of the Morning Calm. That is where I am currently living as an "Englishee teacher." As I go about my life, I'm sure that I will encounter a few interesting things, and I might try to be a little adventurous. Stop by often for some non-stop Korean taekwondo-style action. Whatever you do, please don't have the fan running while reading this - 





Post a Comment