Protests come with such excellent branding these days. UK Uncut proffered this in a November 11th posting on its site that announced action on December 8th:
In our previous post, we outlined how Starbuck’s UK subsidiary would still have been loss-making last year if two of the three tax beneficial strategies mentioned in the press were reversed. This does not, however, get to one of the biggest sticking points of the story for a lot of people. Namely that the company has made statements that allude to its UK business actually being attractive. Read more
There’s a problem with the Starbucks story, which first broke in mid-October when a Reuters report noted that the company hasn’t been paying corporation tax in the UK due to technically being loss-making.
It’s a real pain to visualise. So FT Alphaville threw this together… Read more
Who doesn’t enjoy a bit of Starbucks bashing? FT Alphaville has certainly engaged in a spot of “what’s that burnt coffee smell? Oh look, there’s a Starbucks!” on our way to our local caffeine supplier, but we don’t hold a candle to the lethal swarm of British politicians, campaigners and journalists that have surrounded the company of late. Read more
Starbucks on Monday unveiled long-awaited plans to bring its coffee shops to one of the world’s greatest tea-loving nations through an $80m Indian joint venture with Tata Global Beverages, the FT reports. The first outlet will open in Mumbai or Delhi by September as part of a wider Asian expansion by the US-based coffee retailer, which has 544 stores in China and has been eyeing the Indian market since 2006. The 50/50 joint venture comes despite recent rule changes allowing 100 per cent foreign ownership of single brand retail stores, underscoring the difficulties faced by western companies seeking to enter India’s $450bn retail market without local partners. Starbucks is seeking to reduce the dominance of the US in its operations. More than 12,000 of its 17,000-plus stores are in its home market. The Americas region – including a few hundred stores in Canada and Latin America – accounts for three-quarters of its revenue. Read more
Starbucks is betting that coffee is an indulgence austerity-era Brits are unwilling to forgo with the global coffee chain planning to open 300 new outlets in the UK over the next five years and hire 5,000 more people, reports the FT. The move, which comes after an aggressive expansion backfired badly in 2008, is at odds with other parts of the food and drink industry which are being forced to pull down the shutters as cash-strapped consumers curb spending and raw material inflation eats into their profit margins. Much of the expansion will be in the north of the UK and about 200 of the planned new stores will be drive-through stores. While big in the US, where Starbucks has 2,500, there are now just 10 such drive-throughs in the UK but, the chain says, customers are seeking more roadside cafes. Read more
Bonuses for chief executives at 50 major corporations jumped a median of 30.5%, the biggest gain in at least three years, reports the WSJ, citing a study of the first batch of corporate CEO pay disclosures by consulting firm Hay Group. The survey reviewed proxy statements filed since Oct 1 by companies with at least $4bn in annual revenue. The 50 CEOs surveyed collected a total of $126.1m in 2010 bonuses, up from about $83m a year earlier. Big winners included the chiefs of Starbucks, Jabil Circuit, Clorox and in particular, Robert Iger, CEO of Walt Disney, whose bonus of $13.5m for the year to Oct. 2 represented a 45.4% increase. Bonuses in general are rebounding as some hard-hit industries like autos recover and corporate profits climb. Read more
Starbucks has accused Kraft Foods of mismanaging sales and marketing of its packaged coffee, Reuters reports, and wants to end their 12-year partnership due to Kraft’s “material breaches” of their contract. The news agency says it has obtained documents showing that last month Starbucks charged Kraft with failing to take “commercially reasonable measures to address the erosion of Starbucks market share,” and that Kraft has disputed the claim. Read more
Reuters reporter Simon Rabinovitch, taking a page out of the Economist’s playbook, has introduced the “Grande Latte index” (with data, methodology and footnotes) in an attempt to answer a thorny econo-philosophical question: are lattes in Chinese Starbucks overpriced or is the yuan simply overvalued, contrary to the prevailing wisdom?
Rabinovitch contends that while the former is more plausible, “it might be equally true that the yuan, if not overvalued, is at least not as undervalued as other measures suggest.” Read more
Starbucks, the world’s biggest coffee shop chain, is to close more stores, sell a newly delivered $45m corporate jet and slash jobs, headquarters staff and worker benefits as it battles a slump in sales that has tracked the broader collapse in global discretionary spending. The company said Wednesday it would shut 300 more “underperforming” locations – 100 of them outside the US – after a 9% fall in comparable sales in the last three months of 2008. It announced a first wave of 600 US store closures last summer. The move will result in about 6,000 job losses, while an additional 700 corporate and support jobs will also be cut – half of them at its Seattle headquarters. Read more
It’s been a bad year for Starbucks. The donuteers haven’t been doing well either. So if not coffee and donuts…
Enter McDonald’s. Buried in an epic article, in Monday’s WSJ, there’s an interesting point about the convergence of various food-retailers due to consumer “convenience”. Witness, McDonald’s and Starbucks, which started out as brands that had little – if anything – in common. Not so anymore: Read more
Howard Schultz, the chairman and founder of Starbucks, is returning to the post of chief executive, replacing Jim Donald, in response to a sharp fall in its shares and growing anxieties about the impact of rapid growth on the company’s brand and performance. A company statement said the move was part of a set of initiatives aimed at “refocusing the company on providing customers with the distinctive Starbucks experience, and building on Starbucks’ legacy of innovation”. Schultz has been chairman since stepping down as chief executive in 2000 after 13 years. Last year he issued an internal company memo to Mr Donald, who joined Starbucks in 2002 and became chief executive in 2005, warning of what he called “the commoditisation of the Starbucks experience”. Read more
1Bernanke weighs in on robot wars; brings Keynes for backup
2About China's capacity to absorb more capital
3Secret liquidity and Scottish independence
4Spain's awful unemployment
5Pump up, debase
Show more6S&P 2,100, by Goldman Sachs
7Buyback to enrich
8Everlasting credit, the long view
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