Should indie cafes welcome competition from Starbucks?
Slate makes a pretty convincing argument that Starbucks is actually helping independent coffeehouses proliferate. [slate]
According to recent figures from the Specialty Coffee Association of America, 57 percent of the nation’s coffeehouses are still mom and pops. Just over the five-year period from 2000 to 2005–long after Starbucks supposedly obliterated indie cafes–the number of mom and pops grew 40 percent, from 9,800 to nearly 14,000 coffeehouses. (Starbucks, I might add, tripled in size over that same time period. Good times all around.) So much for the sharp decline in locally owned coffee shops. And prepare yourself for some bona fide solid investment advice: The failure rate for new coffeehouses is a mere 10 percent, according to the market research firm Mintel, which means the vast majority of cafes stay afloat no matter where Starbucks drops its stores. Compare that to the restaurant business, where failure is the norm.
In summary, Starbucks’ coffee is nasty and overpriced and independent stores are doing well because of it. The mystery of how Starbucks itself continues to thrive will never be solved.
Starbucks has what McDonalds has: name brand recognition and a strong grip on the public conscience.
Plus, in other cities, you don’t see the plethora of indie coffee options that you see in Seattle. It’s pretty much Starbucks and then a bunch of podunk places whose coffee is even worse. Sure, Starbucks is predatory in staking territory, but the tepid competition makes it even easier for them.
When you have a strangehold on market share all over the globe, you might as well print money.
I agree with Gomez. Most places in the States (like Georgia where i just came back to Seattle from) only have watered down, independent coffee houses. So people go to Starbucks for all the reasons Gomez stated and then also because people want a strong cup of coffee.
I was being a little disingenuous with the “mystery” comment.
I always find people complaining about Starbucks coffee amusing, since when I was in college in the Paleozoic Era (aka the early 1990s) your choices were drip and espresso. And by espresso I mean this bitter motor oil they produced that would keep you up for a week.
Coffee back then was pretty nasty. And then Starbucks popped up in Boulder. And suddenly, all these other indy coffeehouses started doing things like cleaning their machines, buying decent beans and grinding them themselves, and actually making what we now call decent coffee.
Yeah, SBUX burns the crap out of their beans. But 20-25 years ago, most people in this country thought “French roast” and “Vienna roast” were flavors of General Foods International Coffee. Coffee was either instant or Maxwell House.
SBUX raised everyone’s boat by convincing people that a $3 coffee was worth it while a $1 cup of drip wasn’t. Put that in your latte cup and drink it.
What Dylan said.
And even here in Seattle in the 80s and early 90s there weren’t nearly as many choices as there are now; I believe Starbucks’ success hellped raise the coffee standard as much here as it did anywhere else. (By the way, until they became a huge company with shops all over the world NO ONE ever complained about their coffee.)
Nobody ever complained about their horribly burnt coffee? I find that hard to believe.
The only thing I’ve ever liked from Starbucks is their cappuccinos. And those only after dumping a bunch of raw sugar into them.
Starbucks isn’t my favorite coffee, but I don’t think it’s all that horrible. Obviously, tastes vary.
Because tastes vary, I am sure there were people who didn’t like Starbucks even back when there were fewer choices, but one never routinely heard complaints about them, especially not at the level of intensity that has become commonplace these days. I don’t get the hate-on people have for Starbucks, anyway–it’s a luxury item that can easily be avoided by, you know, not buying it.