This Is Going To Leave A Mark
How bad is it for mom and pop store when a large massive corporation sets up shop next to there store?
Soon after declining Starbucks’s buyout offer, Hyman received the expected news that the company was opening up next to one of his stores. But instead of panicking, he decided to call his friend Jim Stewart, founder of the Seattle’s Best Coffee chain, to find out what really happens when a Starbucks opens nearby. “You’re going to love it,” Stewart reported. “They’ll do all of your marketing for you, and your sales will soar.” The prediction came true: Each new Starbucks store created a local buzz, drawing new converts to the latte-drinking fold. When the lines at Starbucks grew beyond the point of reason, these converts started venturing out—and, Look! There was another coffeehouse right next-door! Hyman’s new neighbor boosted his sales so much that he decided to turn the tactic around and start targeting Starbucks. “We bought a Chinese restaurant right next to one of their stores and converted it, and by God, it was doing $1 million a year right away,” he said.
So let me get this straight. When you offer a higher quality product at equivalent price you don’t lose your consumer base? Odd and here I thought capitalism failed when massive corporations got involved. Huh. I guess corporations don’t have coercive force like some of me reader’s best friend: the state. I trust corporations because I don’t I have to. Same can’t be said about the state.
January 1st, 2008 at 12:33 pm
“I trust corporations because I don’t I have to. Same can’t be said about the state.”
You trust the state more than many of us, given the powers you are comfortable with providing it in the name of supposedly combating terrorism.
January 1st, 2008 at 11:23 pm
Gee, it’s almost like all the people you’re trying to argue against had a really good reason for using Wal-Mart as their example instead of Starbucks.
January 2nd, 2008 at 12:31 am
What are these really good reasons?
January 2nd, 2008 at 8:29 pm
Wal-Mart actually does drive competitors out of business, becuase it’s huge buying power and streamlined operations allow it to sell teh same goods at much lower prices. Using Star-bucks as an analogy is obviously problematic, since they sell the same good at much HIGHER prices.
If you have any data showing that small local businesses which sell the same goods as Wal-mart improve their business when Wal-Mart opens a store near them, I’d love to see it.
January 2nd, 2008 at 9:04 pm
Speaking of Walmart, haven’t they received a bunch of government subsidies? I’d figure such a great corp could do it on their own…. Oh well.
January 3rd, 2008 at 3:34 am
How is Wal-Mart unfairly using the government against its competitors an argument against laissez-faire practices?