More on SBUX

We just wanted to point out a rather curious headline this morning from the Wall Street Journal website:

"Starbucks blamed long Frappuccino lines for slowing sales, but Wall Street is concerned the coffee chain for the first time may be vulnerable to cutbacks in consumer spending."

Hard to see how overcrowded stores constitute a symptom of slumping sales.  But let's listen to their reasoning:

"Starbucks blamed the weak July sales growth on unexpectedly heavy demand for cold, sweet Frappuccinos in the morning, spurred by heat waves across the country. Frappuccinos take longer to prepare than most drinks because they are mixed in a blender, topped with whipped cream and drizzled with sweet toppings. That made Starbucks's frequently long lines even longer, driving away customers, the chain said."

So "unexpectedly heavy demand" for one of their most expensive products shrinks sales?  As the Journal article points out, Wall Street isn't buying it, and SBUX fell 8% yesterday.

Comments

[Steve Donahue]

I'm not sure that same store sales are as important at SBUX as in many other chains because they keep opening new stores in relatively close proximity to their existing stores. This has to slow growth at the older stores. In Reno, where I live, there are now 3 Starbucks within 1.5 miles of my home. Two years ago there was just one. Eventually, the economy will affect SBUX but it doesn't appear to have happened yet.

[Barefoot Running]

The next time I read a blog, I hope that it doesnt disappoint me as much as this one. I mean, I know it was my choice to read, but I actually thought youd have something interesting to say. All I hear is a bunch of whining about something that you could fix if you werent too busy looking for attention.

[Ugg Outlet]

I really like this website , and hope you will write more ,thanks so much!You are so talented continue doing great topics.