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Coffee Price Hikes – Did you notice?

MatthewMcClifford — Fri, 23 Dec 2011 22:14:21 +0000

What do you get with rising commodity prices and disappearing margins? Screwed – that’s what.

It’s become all too noticeable to those paying attention. Large corporations continue to give less and less through subtle marketing techniques and small business struggles to keep customers by offering ridiculous deals in order to just keep the doors open.

Coffee Price Hikes

The latest rubber glove comes from the coffee giant and icon, Starbucks. Admittedly, I’m not nor was I ever a Starbucks fan. To me it was like buying Gap – not because it was any higher quality, but a name that was considered trendy. Starbucks is no different – after all why would anyone pay $4-5 for coffee that is average at best? Is it that whipped cream that does it for you? Or the high fructose flavored syrup? The add-ons simply mean they can charge your more in a compounding fashion.

But back to my point. The coffee price has been rising and is at highs not seen since 1998. You can bet that Starbucks have been making a money mattress selling those $5 double caramel mochachitos, and want to keep that profit margin intact. So what do they do when their cost of raw goods goes up? They get clever on your ass.

Introducing, the “Trenta”. A 31 oz shot of liquid jitters is now available for those of you who find the 24oz Venti or 16 oz Grande just won’t do it. If you want to upgrade from a Grande to a Venti, it costs another 30-35 cents. But to upgrade from a Venti to a Trenta it will cost you 50 cents more, and you only get 7oz, not eight. So to supersize you get short sized! Clever way to overcome margin squeeze, and I suspect no one will be the wiser, or care for that matter. That’s loyalty for you.

Starbucks is not the only business playing this game. Restaurants are charging more for less and of lower quality. Subtle changes like cheese whiz for your nachos and not cheddar. I can’t blame the small business because it’s do or die for some of them. However, Starbucks has some change in the bank and may just have to put a hold on expansion to Greenland in order to get through this recession. Arguably, coffee is recession proof anyway as its one of the last things people will give up. 2.25 billion cups of coffee a day is a glaring reminder of that.

Its during times like these that the diamonds come out of the rough and find a way to not only give better quality and quantity, but to provide an experience that none of the rest can deliver. It will take creativity and smart business, but it can be done. It will have its rewards for those who invest in it.

When you find one, stick close and become loyal to proper business ethics. That’s your vote. And unlike politics, it can make a real difference to your life. Once you alter a company’s bottom line, they have no choice but to listen. Therein lies the leverage.

So what’s the bottom line? Be aware and be prepared. Don’t pay for that coffee price hike at Starbucks, and realize it’s only the beginning.

To learn more about healthier coffee options, please visit http://ganocoffeebenefits.com/.

Coffee Prices Going Up – You’ve Been Scammed

MatthewMcClifford — Fri, 23 Dec 2011 22:13:04 +0000

What do you get with rising commodity prices and disappearing margins? Screwed – that’s what.

Coffee Price Hikes

So what’s the bottom line? Be aware and be prepared. Don’t pay for that coffee price hike at Starbucks, and realize it’s only the beginning.

To learn more about healthier coffee options, please visit http://ganocoffeebenefits.com/.

How Did 2% Milk Get So Complicated Starbucks?

Derick-Schaefer — Mon, 13 Oct 2008 01:15:55 +0000

Until the Spring of 2007, Starbucks Coffee did not carry 2% milk in their inventory. When customers ordered 2% milk, their order was fulfilled by mixing whole milk and skim milk. Having a corporate culture very much driven by internal operations, ordering 2% milk was generally fairly complicated. In most locations in North America, there was a general back and forth between staff and customers until everyone agreed, “Just mix the skim and whole milk and let’s move on!”. In the State of Texas, however, you had to specifically use the descriptor “blended”. Why? I’m not sure but it was a pretty “in your face” requirement across the state and wasn’t used anywhere else in North America. Outside of the United States, the problem worsened. An example would be the term “half skinny” which was a standard request in the UK. In May of 2007, however, the end appeared in site as Starbucks made a cost cutting move which standardized on 2% for all of their drinks–think again.

As of May 2007, Starbuck’s internal operations changed the Starbucks vocabulary to eliminate the word 2%. After all, 2% milk was the default thus there was no need to declare it as a descriptive word when refering to a variation in a product. The problem is, the rest of North America, continued to view 2% milk as simply a type of milk. Thus, when customers ordered their drink with 2% milk, the strict operations driven culture at Starbucks all but mandated that hourly employees respond to the customer with “2% is our standard milk”. They couldn’t just mentally translate the request, it had to become a source of confrontation. Hence, discussion at the cash register broke out between customer and employee causing more confusion than even the vintage days of baristas making on the fly versions of 2% milk by “blending” (Texas talk) whole and skim milk. Is the fact that Starbucks has made something as simple as 2% milk so complicated something indicative of their corporate culture that will haunt their ability to deal with customer satisfaction perceptions that already plague the company? Do the Seattle based geniuses that run the company know something that we don’t making our view of a world that includes 2% milk completely out of date? How did it get so complicated?