Coffee video--did they say Starbucks is hurting?!
Did they say starbucks is hurting? Do you think it will change?
Answers: http://cosmos.bcst.yahoo.com/up/player/p...
Did they say starbucks is hurting? Do you think it will change?
yes they did. they are not used to such competition
They started noteing in the News in December that Starbucks was crashing down. This started Months earlier.
Fast Food places are provideing more elabrate "Coffee" now. The difference people are noticeing is the Fast Food places are better and cheaper.
(Last Starbucks I walked into what I wanted was nearly 5 dollars. Last McDonald's I wanted a Hot Drink at I only paid something over one dollar but under two dollars. The difference is McDonald's fails at consistancy.)
A recent economic report released by the company says that the sales revenues are consistently down. The first step they plan to take is to look at their "inefficient" stores (the ones that have lower than average sales totals) and close them. Next they'll probably end up raising the product prices.
This is pretty typical of a company that practices market-saturation. When there are too many stores to go to, ALL of them suffer. If someone REALLY wants Starbucks coffee, they'd be willing to drive a few miles out of their way to get it. Right now, there's literally a Starbucks within a 5-10 mile radius of every other SB store in all major cities they populate. THAT is too many stores. Time to cull the herd.
The problem was that the fast food restaraunts didn't offer much in the line of coffee. You had caffinated or decaf. Once coffee really started to boom, and the places like Starbucks and Seattle's starting booming so much, the fast food places really stepped up their game. They all started offering different roasts and varieties with good flavor while being a much cheaper price. This has definetly put a hurting on the places that their business relies mostly on coffee.
my guess is that with the overall economy down, housing market down, gas prices up, people losing their jobs, the easiest thing to do is cut down on their expensive specialty coffee intake.
Their stock has been in a decline.
What goes up must come down.