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On July 2, Starbucks announced its decision to close 600 stores in the United States. Ten days later, the company posted a list of 616 stores that the company said are ‘underperforming’ and will close by the end of March 2009. In the wake of the announcements, newspapers started to report on community ‘activists’ working to save their local Starbucks stores from the chopping block. They range from retirees to teens who have found their ‘third place’ at the coffee counter of their local Starbucks. The movement has even spawned its own website, www.saveourstarbucks.com, where Starbucks customers are encouraged to post their stories which, say web site owners, will be shared with Starbucks corporate offices.
Starbucks is touched, really. At least, that’s what a spokesman for the company said in a statement released July 21st. It read in part, “We are humbled by the support we’ve received from our partners and customers regarding the closure of our stores. We recognize the impact this announcement has had on the communities where we operate and value the feedback.”
But it’s not changing its mind. In the same statement, the coffee giant said that the list of 616 stores is considered final, and the stores on the list would close between now and March.
The store closings, which were anticipated by bloggers and reporters and newspapers around the country as intently as if they were military base closings, will affect an estimated 12,000 jobs across the country. That number sounds enormous, but when you break it down, it averages out to 20 people per store. The big outcry in most cities isn’t about the job hit – there’s something else being lost here.
Exactly what that something might be is open to dispute. Dallas columnist Rod Dreher thinks it’s a loss of status. In The Dallas Morning News he wrote, “It’s become a sign of middle-class American modishness. To get a Starbucks in your neighborhood meant that you were validated.”
Losing a Starbucks means losing that status – a neighborhood on the way down.
Or it could be something similar to sibling rivalry. According to those who have analyzed the store closings, over half the stores being closed are within two miles of another Starbucks. In some big cities, that proportion is far higher. In New York City, for example, 72% of the stores scheduled to close are near another Starbucks. Many of the ‘stories’ posted on the Saveourstarbucks.com site have a flavor of ‘why OUR store instead of THEIR store?’
The store closings show a couple of other patterns as well. A very large proportion of the stores being closed have been opened in the past two years during Starbucks’ most aggressive expansion era ever. The ‘underperformance’ is not necessarily operating at a loss, either. They’re simply not as profitable as the company expected that they would be.
And then there’s the perceived regional ‘bias’ – according to the Seattle Times, the central part of the country will lose 13% of their Starbucks stores and the Southeast will lose 10%, in comparison with the Northeast, which will lose only 8% and the West Coast which will lose only 5% of their company-owned Starbucks stores.
Does that mean that Starbucks doesn’t like Middle America – or does it mean that Middle America didn’t embrace Starbucks the way that trendy East and West Coasters did? In either case, there’s a sharp dichotomy between the attitude toward the closings in big cities and the closings in small towns as evidenced by the headlines from various newspapers. In Seattle, the headlines read “19 Starbucks Closing – Who Cares?” Easy for Seattle to say – they’ll still have 388 company owned stores in the state. Meanwhile, in Baltimore, Effie Dawson asked, “Starbucks, what were you thinking?”
Obviously, if the numbers tell the story, not about the customers – or the coffee.