Starbucks. Too much, too fast?
Starbucks is slated to close about 600 of their retail stores around the country. Here in Austin, Texas, they are scheduled to close two stores, one of which is located close to my home. Granted, there are about 4 Starbucks stores in a 1 miles radius of my house and the one closing is one that I do not frequent. However, I was surprised to learn that this particular store is closing since it’s located in a new retail development that is booming in South Austin. It’s also located right off of Interstate 35 and is fairly easy to get to should you exit the highway for some brew.
Regardless of the location and patronage, do you think Starbucks grew too much, too fast? I remember a few years ago when Starbucks was tooting their horn on how many stores they were opening each and every week. I also remember that some market analysts speculated that the rapid growth of the retail stores would one day come to bite Starbucks in the butt. It looks like that time has finally come.
The majority of retailers out there forced to close 600 stores would consider this a huge loss. Granted Starbucks is taking quite a hit for many of these stores. The one in South Austin alone hasn’t been open for more than a year. But given the 1000’s of retail locations they currently have open, is this truly a hit in the pants?
I love a Starbucks drink just like the next person. But I have to admit it’s not always a place that I frequent. I’m on a budget and Starbucks is one of those places that I use for a “treat” or the occasional meeting place. I stick to the packaged Starbucks coffee and brew at home at a substantially lower cost.
Does anyone else think that Starbucks grew too much, too fast?
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Comments
Actually, there are no franchise owners. Starbucks is fully corporate owned (at least in the US and Canada)…so the issue is one that will only really hurt the company. All employees will just get moved around. I worked for them for a couple years, and even then I felt that they were growing faster than demand could sustain. Oh well, I guess it’s a good lesson for everyone to keep from getting too proud of themselves.
I do believe they grew too fast. Maybe it would be more accurate to say that too STEADILY grew too fast. For some years in the 1990s and 2000s, they could sustain that sort of growth. But they KEPT trying to hit go-go growth numbers year after year . . . and, yes, apparently they got ahead of themselves.
I think they made other mistakes, too. If you’re not familiar with it, you might check out John Moore’s Brand Autopsy blog, which has *much* more to say on the subject of the Starbucks brand:
http://brandautopsy.typepad.com
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They grew too fast.
Just from a customer perspective:
Going to starbucks was not an experience anymore. The culture was too driven by selling sandwiches, smoothies, DVDs (alkeelah and the bee anyone?) and CDs.
Since I am blessed to live a rather large city, I’d rather spend my money at an original coffee shop with its own blend of coffee.
So, I want to know what happens to all of the franchise owners that bought into the franchise, but had corporate pull the plug on them? Are they left high and dry or is there some kind of pay out?
The one at Slaughter and Mopac is one of the Austin stores closing by the way. It is brand spankin’ new too!
Yes, I think they grew too fast just like a lot of things in the market.