Friday, February 1, 2008


Even Starbucks has taken note of the economy. With year end earnings less than stellar and slowly grinding to a halt, Starbucks has realized that consumers are holding on to their money. Job losses combined with the home mortgage mess and uncertainty in the financial markets have loyal customers cutting back on the java.

To lure these cutomers back and to bring in new ones (like me) who felt that paying $6.00 for a cup of coffee was better spent on contributing to a savings plan, Starbuck's has introduced the $1.00 short coffee in response to competition from Mcdonald's and Dunkin Donuts offering gourmet like coffee at affordable prices.

Also cutting out the expanded lines of breakfast sandwiches which were not sellng plus "the aroma was interfering with the coffee" made management at Starbucks realize they were in the coffee business after all and were slowly losing their niche. Changing the formula that had worked for them in the past was cutting into the company's profits

1 comment:

L Wilder said...

I agree with the article. Starbucks needs to stick with what it knows best. That is coffee.