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Will Starbucks Survive the Recession?

Starbucks has never been in so much trouble, financially speaking. The company's same-store sales continue to worsen as consumers visit the chain less frequently, and CEO Howard Schulz admitted, "We're beating ourselves up every day because we've just never seen numbers like this." He predicts that 2009 will be an even bigger challenge than the second half of this year but thinks the company will get by until the economy begins to improve.

It seems Starbucks strategy won't change much from its previous moves to make a comeback. Before, it was the introduction of a customer loyalty card and new lines of smoothies and healthier food items. This time, Starbucks is reacting to its worrisome finances with plans to start selling its Seattle's Best Coffee brand at nearly 2,000 Subway locations, launch new tea lattes, and will use only one recipe for banana bread instead of 11.

Do you think Starbucks will be able to make it through the recession?


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Shadowdamage Shadowdamage 8 years
I will add this though, for people working at Starbucks, especially those that posted, I hope your branches hang tough and you keep your jobs - I hope my post didn't offend as it certainly was not the intention. :) Its just an unfortunate reality that it is, ultimately, a luxury item (some might argue even more than expensive clothes as they "keep on giving", so to speak), and those are usually the first to go in tough times.
booglass booglass 8 years
I don't know. Starbucks is as much about the coffee as it is the social aspect. When I lived in the states it was a great place to meet friends and chat. So I think providing a relatively low cost social outing may help buoy it through tough economic times. But I must admit, I don't miss them as much as I thought I would. Especially, after I figured out how to make my own chai tea.
Shadowdamage Shadowdamage 8 years
Bodum French press + good freerange grind = better than, cheaper than Starbucks and can be made anywhere you boil water. Bialetti Mokka Express + milk + water + espresso grind = ditto, except change "boil water" to "can stick on stove". Starbucks has had their day, and personally I don't care what happens to them that much in this economy. Their prices were made for better days, and I doubt they can maintain a proper profit margin if they charged what coffee actually COSTS to make. They've had it pretty easy for a long time, as long as people were able to pay for convenience. Saying all that I do like a nice coffee shop but there's others to choose from, at least where I live there's Costa and Nero's, which I liked better anyways and is comfier and has nicer sandwiches. :P
NouraBee NouraBee 8 years
No Way starbucks makes at less 13888 a day on my campus thats per stand we have 4 !!! and its not even in america ! so i don't think there in a bad situation
PiNkY-PiNk PiNkY-PiNk 8 years
I love starbucks and wouldn't want them to go away so they should definitely lower their prices.
CUPCAKEchatter CUPCAKEchatter 8 years
I think that the best way to survive the recession is for Starbucks to lower their prices. Sometimes a cup of their drinks is equivalent to a meal...
Glittersniffer Glittersniffer 8 years
Don't care for their coffee (always tastes burnt to me), but I do like their caramel apple spice. However, unless I'm in the mood for the caramel apple cider, I go to the local place. They're reliable for fair trade, and they're a mom and pop place. They also happen to have wonderful cannoli!
bleached bleached 8 years
Coffee shouldn't be a luxury :(
Yaya123 Yaya123 8 years
Oh, and to everyone...its more of the routine/ luxury status of Starbucks than the actual coffee haha. I like drinking it and get free drinks at work so I can't complain. But yes, the prices are fairly high, but its a luxury. When the economy was doing really well and stock prices were in the $30 a share range they got too excited and opened more and more stores. Now that things have slowed down, as with all businesses, it's very hard to sell a "luxury" item to people when they can barely make their mortgage payments and buy groceries.
Yaya123 Yaya123 8 years
Well, I work part time at Starbucks and go to school, I've worked there for almost 3 years. I've noticed some of our regulars coming less often, or getting smaller sizes. Our labor has been cut too. We are still a busy store though. Right now is the holiday season so it's hard to say, but I'd say its about as busy as it was last year. It's a great company, and I live in Seattle. I've spoken to alot of people in the corporate office and know a few people in the communications dept that dealt with the store closures during the summer/fall. It's definitely tough for everyone, not just Starbucks. But I hope we survive :D
LaurenG22 LaurenG22 8 years
True true Spectra, starbucks is not even that tasty!
Spectra Spectra 8 years
See, the reason I don't think they'll make it is because there are so many other, BETTER coffeeshops out there with better coffee. Our city has 2 Starbucks (I think), yet if I want to go out for a good coffee drink, I'll go to New Moon because their drinks are 1) cheaper and 2) tastier than Starbucks. So unless they lower their prices and improve their roasting/brewing process, I don't think they'll last.
Megatron Megatron 8 years
LaurenG22, I completely agree. If they shut down some of the stores thereby increasing the demand it might help. It also might help if they lowered their prices.
LaurenG22 LaurenG22 8 years
I make my own coffee at home... not much of a fru fru drinker, myself. I like black coffee :shrug: I hope it survives, but it might want to shut some locations, like the one that is 15 feet away from another starbucks :true:
cpianolover cpianolover 8 years
I love Starbucks! I hope it survives, and I've noticed that the Starbucks that I go to are as busy as ever. The lines are so long!
esmerb esmerb 8 years
I hope it does survive, not just cause I love Starbucks, but also cause it was be so sad to see a company fail. But I do agree in that they need to do something about their prices...
ilanac13 ilanac13 8 years
i do think that it's going to make it. there are enough people here in NYC that would keep the company going and i don't know what we would do if there wasn't a starbucks on every corner
Kaizykat Kaizykat 8 years
"Starbucks coffee tastes burnt - I can't stand it. Even their light roast tastes burnt. I like my coffee to taste like coffee." Agreed fully, Geebers. Honestly, if a company can't make a good cup of coffee, I'm not too crazy about trying the rest of their goods. Recently my dad bought me some Starbucks oatmeal. Ew. It was so gross!
fleurfairy fleurfairy 8 years
I love Starbucks. They treat their employees very well and the employees always look happy to be at work. I definitely respect that. As for the coffee, I never have it. I only have skinny lattes and they are delicious. I hope Satrbucks finds a way to survive. Lowering prices is certainly a good option instead of throwing in the towel completely.
RockAndRepublic RockAndRepublic 8 years
No, i wont stop breathing if they cease to exist.
Spectra Spectra 8 years
I can't stand Starbucks. Considering how much cheaper and better-tasting it is to make your OWN coffee at home, I think a lot more people are going to start doing that. I invested in a really decent coffeemaker for $150 and a grinder. I buy my own whole bean coffee and I make my own drinks at home for probably 1/10 or less of the price that I'd pay at Starbucks.
Smacks83 Smacks83 8 years
LOL LeMuse! Coffee flavored coffee. I personally hate all coffee (even things like coffee flavored candies or icecream, bleh) so I don't care except Starbucks dug their own grave by opening so many stores so close to each other that they spread themselves out too thin.
bleached bleached 8 years
Maybe they should stop charging 5$ for coffee... I don't know how people can afford to go there 3 times a day every day
WeTheLiving WeTheLiving 8 years
I sure hope so! I love my White Chocolate Mocha! Maybe it's just me, but I don't think introducing healhy snacks and smoothies is going to help. I don't go there for healthy stuff. If anything, they should try to make the coffees they have healthier AND still delicious. I'd go for that. They probably shouldn't have built so many stores so fast. They definitely need to bring back the cute cups! They're pricy, but sooo cute and the last few months or so, they haven't had any but the really plain ones. I usually buy a few as Christmas gifts, but I guess not this year. I don't know what they're thinking!
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