starbucks closes 600 stores… July 2, 2008
Posted by irish.lemon in starbucks.Tags: 600, barista, chicago, closing, communications, public relations, starbucks
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alright, now that my first class is over, i’ve got a few cents to put in about this from an employee’s point of view…because if i get asked one more time about the store closings and whether or not my store is one that’s closing, i’m going to chuck a bottle of vanilla syrup at someone’s head.
in all honesty, i see the store closings as a good move by starbucks. i have a few theories that i’ve been playing with to rationalize that claim. consider chicago for instance…there are literally at least twelve starbucks stores within a four [city] block radius. you physically cannot pass a corner without seeing a starbucks from at least one angle. yes, it’s convenient for the consumer to have multiple storefronts within almost literally ten feet from each other, however this practice causes “cannibalizing”. the term “cannibalizing” is relatively self-explanatory here if you consider it from a retailer’s point of view. having so many stores in such close vicinity causes them to compete with each other…inter-corporate competition – at least from a fiscal point of view – is extremely unhealthy.
to set the record straight about why stores are closing is the simple fact that market-saturating stores are not meeting their sales goal of approximately $2500 a day. i’m not sure of the exact number for these 600 stores – as i don’t think i realistically should unless i worked in accounting for corporate – but when you think about it, 600 stores only account for about 7% of starbucks’ total US market.
now, i’m not saying a few thousand baristas losing their jobs is a good thing. if my store was one that was closing, i’d be a bit nervous myself, especially with the current job market…or lack thereof. but i have an explanation for this.
let’s do a little math…let’s say you have approximately 20 employees per [closing] store. so when everything is said and done, you have approximately 1200 displaced partners. now let’s say half of those partners completely leave the company and the other half stay to be relocated to other stores within their region. so we still have 600 partners…now, let’s assume 300 of those 600 partners are shifts/store mgrs/regional mgrs/etc. generally, those managers move from store to store on a usual basis. therefore, you have most of your management tranferring to other stores to continue working. the same – theoretically – would go for the 300 baristas as well. and here’s the kicker…roughly 200 or so new stores are set to open for the 2009 fiscal year – presumably within the same region. so, in essence, everyone’s worrying – or cheering – over a relatively small issue.
there’s a good possibility that i’m being left in the dark about further details, but that wouldn’t surprise me. PR-wise, i’m not sure how positive this will be for the company. there will always be the nay-sayers, but howard schultz seems to be admitting guilt on behalf of the company…that makes me nervous.
and as a disclaimer – because i’m sure i’ll get flak from someone – these are my personal thoughts and opinions which in no way directly reflect those of starbucks. although i presumed that was generally implied…
