I'm an SBUX long but I think this is funny,
especially when you read it in Jacke Mason's
Starbucks is the best example of a phony status symbol
means nothing. People will pay 10x as much for
Starbucks because there are French words all over the
place. You want coffee in a coffee shop,that's 60
But at Starbucks,
Cafe Latte: $3.50.
Cafe Suisse: $9.50.
For each French word,
another four dollars. Why does a little cream in coffee
make it worth $3.50? Go intoany coffee shop; they'll
give you all the cream you want until you're blue in
the face. Forty million people are walking around in
coffee shops with jars of cream: "Here's all the cream
you want!" And it's still 60 cents. You know why?
Because it's called "coffee." If it's Cafe Latte - $4.50.
You want cinnamon in your coffee? Ask for cinnamon in
a coffee shop; they'll give you all the cinnamon
Do they ask you for more money because
it's cinnamon? It's the same price for cinnamon in
your coffee as for coffee without cinnamon - 60 cents,
that's it. But not in Starbucks. Over there, it's
Cinnamonnier - $9.50.
You want a refill in a regular coffee
shop, they'll give you all the refills you want until
you drop dead. You can come in when you're 27 and
keep drinking coffee until you're 98. And they'll
start begging you: "Here, you want more coffee, you
want more, you want more?" Do you know that you can't
get a refill at Starbucks? A refill is a dollar
fifty. > Two refills,
$4.50. Three refills,
$19.50. So, for four cups of coffee - $350.
burnt coffee. It's burnt coffee at Starbucks, let's be
honest about it. If you get burnt coffee in a coffee
shop, you call a cop. You say, "It's the bottom of the
pot. I don't drink from the bottom of the pot.
when it's burnt at Starbucks, they say, "Oh, it's a
blend." It's a blend? "It's a special bean from
Argentina....." The bean is in your head.
I was thinking of buying SBUX the day after it
took the big plunge a few weeks ago in spite of
financial numbers and a gut hunch telling me it was
overvalued. So, I decided to hold off a few days to see if it
had a healthy rebound in it. So far, it doesn't look
good; its high price seems to be making the stock value
slowly shave downward, and the intense fan loyalty for
this one makes it a risky short play also. It reminds
me of another company that went sky-high and hit
I sure hope this company
doesn't change its name to "Boston Coffee"!
And there are no chairs in Starbucks. Instead,
they have these high stools. You ever see these
stools? You haven't been on a chair that high since you
were two. Seventy-three year old Jews have to climb
and climb to get to the top of the chair. And when
they get to the top, they can't even drink the coffee
because there's 12 people > around one little table,
saying, "Excuse me, excuse me,
excuse me, excuse me....."
Then they can't get off
the chair. Old Jews are begging Gentiles,"Mister,
could you get me off this?" Do you remember what a
cafeteria was? In poor neighborhoods all over this country,
people went to a cafeteria because there were
waiters and no service. And so poor people could save
money on a tip.
Cafeterias didn't have regular
tables or chairs either. They gave coffee to you in a
cardboard cup. So because of that you paid less for the
coffee. You got less, so you paid less. It's all the same
as Starbucks - no chairs, no service, a cardboard
cup for your coffee - except in Starbucks, the less
you get, the more it costs. By the time they give you
nothing, it's worth four times as much. Am I exaggerating?
Did you ever try to buy a cookie in Starbucks? Buy a
cookie in a regular coffee shop. You can tear down a
building with that cookie. And the whole cookie is 60
cents. At Starbucks, you're going to have to hire a
detective to find that cookie, and it's $9.50. And you
can't put butter on it because they want extra. Do you
know that if you buy a bagel in Starbucks, you pay
extra for cream cheese? Cream cheese, another 60 cents.
A knife to put iton, 32 cents. If it reaches the
bagel, 48 cents. That bagel costs you $312.
don't give you the butter or the cream cheese. They
don't give it to you. They tell you where it is. "Oh,
you want butter? It's over there. Cream cheese? Over
here. Sugar? Sugar is here." Now you become your own
waiter. You walk around with a tray. "I'll take the
cookie. Where's the butter? The butter's here. Where's
the cream cheese? The cream cheese is
walked around for an hour and a half selecting items,
and then the guy at the cash register has a
in front of him that says "Tips." You're waiting on
tables for an hour, and you owe him money. Then there's
a sign that says please clean it up when you're
finished. They don't give you a waiter or a busboy. You
have to clean up the place. Old Jews are walking
around cleaning up Starbucks.
"Oh, he's got dirt too?
Wait, I'll clean this up." They clean up the place for
an hour and a half. If I said to you, "I have a
great idea for a business. I'll open a whole new type
of a coffee shop. A whole new type. Instead of 60
cents for coffee I'll charge $2.50, $3.50, $4.50, and
Not only that, I'll have no tables, no chairs, no
waiter, no busboy, and you'll clean up for 20 minutes
after you're finished." Would you say to me, "That's
the greatest idea for a business I ever heard! We can
open a chain of these all over the world!" No, you
would put me right into a sanitarium. Starbucks can
only get away with it because they have
titles for everything, the Nazi bastards
sons-of-bitches. And I say this with the highest respect, because
I don't like to talk about people.
Where can I get a more updated list of insider
trades. Yahoo's list is from april. I want to make sure
old Howard hasn't sold all his shares and fleeing to
europe and leaving us latte lovers holding worthless
stock. I don't see a turn around coming this summer.
weather is too cold, coffee futures are too high,
estimated cost for innner city location, underestimated and
rents are too high in the inner cities because the
landlords(howards friend) are making a killing off the renter. Not
to mention the tea sales in China are slow and the
Starbucks newest adventure into rice bars are not taking
off like expected but watch for a prototype to open
in Seattle's international district.( but that is
considered an inner city location so they have entered into
joint venture with Howard's brother, Saul. who has a
better understanding of what it takes to operate a
turnkey operation in inner city locations.
...and analysts are liking it.
July 22 8:49 PM ET
Starbucks To Tone Down Internet
By Chris Stetkiewicz
SEATTLE (Reuters) -
Coffee retailing giant Starbucks Corp (Nasdaq:SBUX -
news) Thursday reported quarterly net income in line
with Wall Street estimates and said it would ease back
on its aggressive plans to expand on the
Chief Executive Howard Schultz said Starbucks will grow
its Internet business conservatively, not through big
acquisitions, as investors had feared, and will refocus on its
core coffee retailing business.
which saw its stock drop more than 25 percent last
month after warning earnings would be depressed by its
Internet investments and slow growth in its non-core
businesses, remains committed to the Web, Schultz
``Our enthusiasm for the potential of the Internet and
our confidence in the power of the Starbucks
brand...remains strong,'' Schultz said in a conference call with
analysts monitored over the Internet.
over the last several months it has become clear that
our enthusiasm has been misinterpreted,'' Schultz
said. ``I want to put those concerns to rest and I'd
like to reemphasize my commitment to our core
Starbucks, which operates or franchises 2,312 coffee stores
worldwide, will forego any major non-retail acquisitions,
specifically those involving the Internet, and expand its Web
business conservatively, Schultz said.
said it planned to open 600 new stores worldwide in
the fiscal year ending September 2000, including at
least 350 company-operated stores and a total of 150
new stores in the Pacific Rim and the United
Company officials also pledged earnings would grow by 25
percent in fiscal year 2000, regardless of its spending
on the Internet.
Analysts hailed the
announcements, saying they showed Starbucks would stop
neglecting its retail business, from which it derives 80
percent of its revenue, and would shop its wares in
cyberspace more intelligently.
``It's tough when you
have a great bricks-and-mortar business to try to
capitalize on the Internet without diluting growth and I was
relieved to hear they're not going to go that way,'' said
analyst Laura Richardson at Pacific Crest
The announcements came after the stock market had
closed for the day. Starbucks shares had finished down
$1.31 at $23.94 in Nasdaq trading.
smaller positions in a number of budding online
companies, Starbucks can lower its financial risk and market
its coffee-related products to a wide range of
consumers, said Hambrecht & Quist analyst Bonnie
``They're biting off a little less Internet, which is what
I thought they were going to do all along,'' said
Tonneson, who rates the stock a buy.
promising a 25-percent growth rate. They have an incredible
brand, and good growth opportunities both domestically
and abroad. That's a buy,''
Schultz, an investor in online auctioneer Ebay Inc. and
Drugstore.com Inc., is determined to tap the Internet to sell
more goods ranging from lawn furniture to
pre-mixed coffee to Starbucks' young, wealthy and Web-savvy
Starbucks is taking a minority stake in Living.com, a Web
portal selling home furnishing which will eventually
expand into other ``lifestyle'' products, Schultz said.
Schultz likened that link to Starbucks' passive
investment in online community operator Talk City Inc.,
which went public this week.
you know it. Last I saw, SBUX was up in after
hours trading, which bodes well for tomorrow. The bad
news is out, and they've indicated that they are going
to reevaluate the internet strategy, to which the
institutional investors will react positively. That alone will
drive the stock up, and I still look for them, in spite
of the "reevaluation", to announce their internet
"partner" real soon, which, if it is a solid partner, will
drive the stock up further. They've gotten the message
regarding the internet stuff...you want to do it, do it,
but minimize the impact on shareholder value. Have
fun in Italy!
Recession means recession. Times are not good.
Equities will be lower across the board. Starbucks will
also be lower. People will continue to take part in
drinking coffe, probably more than ever. Did I miss the
news? Did Starbucks send out a release that states they
must always get $3 for a cup of coffee? Is it in the
company bylaws? If they determine the need to drop price
to compete I'm certain that it would not knock them
out of business.
Are there too many McDonald's?
not remotely comparable to Boston Chicken.
"Saturation" is not an issue for SBUX. Are there too many
coffee shops generally? Probably. But it isn't the SBUX
shops that will go away, it's the mom and pops. Their
supposed "competitor" Diedrich will probably "revise"
estimates on new store opening, but SBUX will keep coming.
Why? Because every town wants their own. Starbucks is
the "giant" of their industry, as an article posted
recently pointed out. Anytime a company hits the jackpot,
everybody and their brother jumps in for a piece of the
pie. Please elaborate, with facts, as to why you think
"the trend is dying." The "trend" will ultimately be
consolidation, and the "giant" will reign supreme.
it will come shortly guys. Shultz has once again
bounced around on strategy. What the hell is his board
doing??? This guy is completely out of control. The book
deal 18 months ago sent him over the edge as to self
importance. Barkley is right on. There is no way a high PE is
warranted. SBUX is not Boston Chicken ( that was always a
joke and never made money), but people have to wake
up. So far, it has been clockwork......the bounce is
now taking place, followed by a plop to 20ish befor
it heads further south.
To those of you who
bought management's shares when they were unloading at
35+ "like a fire drill", you cannot hope this stock
up. Cut your losses. Shultz does not have the "right