Tuesday, October 28, 2008
The economy and starbucks
Because my mom is an investor for companies in distressed debt, our house has been filled with talk about the economic crisis. So this week I read an article entitled, "Starbucks' business may have bottomed in Q4." The article is about how the bad economy is affecting their sales. The crisis has made the company's reputation go sour, and people are starting to really recognize how expensive their coffee is. They're refusing to cut their prices, and in stead they've closed 600 starbucks stores and are laying off many workers. Although the economic crisis is horrible and is making life harder for some people, I think that there is a positive side to it. Just like people are recognizing how expensive starbucks really is, we'll start to see what is necessary and what is outrageous.
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2 comments:
It is interesting that Starbucks is refusing to cut their prices. I think that this shows a stubborn attitude that probably won't help their business in the long run. Also, it is sad that the company is choosing to hurt their workers instead by laying them off. However, I also agree that the economic crisis might help people in our consumer-based society realize what they really need and don't need. Although this might not be good for business, I think it has benefits for the environment and our society's mentality in general.
That is a good point. With the declining economic situation, most people will stop getting overpriced things unless they are absolutely necessary. All businesses, but especially the service industry will feel the effect of this crisis.
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