Monday, April 14, 2008

The Venti Effect

Are you one of the many Americans who believe that the Starbucks Corporation has had a ruinous effect on locally owned coffeehouses? If so, think again. In his new book, Starbucked, Taylor Clark writes, “For most locally owned coffeehouses, a new Starbucks nearby is actually cause for celebration.”

How is that? “Starbucks doesn’t enjoy the same competitive advantages as other megaretailers,” Clark explains. Wal-Mart “has lower prices than any of its rivals, its hours are generally longer, and its range of products is larger. None of this is true of Starbucks.” A new neighborhood Starbucks tends to boost interest in specialty coffees, thus creating an opportunity for independent coffeehouses that stay open later and offer better or less costly products. “The Omaha World-Herald reported that after Starbucks blitzed Omaha with six stores in 2002, business at locally owned caf├ęs was up as much as 25 percent, with many new mom and pops opening up.”

Read more about the Venti Effect and other topics.

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