Our Friends at Starbucks

Here comes the crunch! Starbucks has finally ended its pattern of cancerous growth. Today, they announced the closing of 500 stores and a possible 100 more, along with the termination of 7% of its workforce. As I once stated, this will probably shoot up its stock and the Wall Street Journal agrees.

The store closures are likely to please Wall Street, which has called for more store shutdowns and swifter spending cuts.

So what does this represent? Well it is the culmination of Starbuck’s general strategy. They have expanded and expanded throughout the US as if they were some kind of monstrous blob. But now that they’ve devoured the whole country and eviscerated their competitors, Starbucks is loosing profitability in some of its stores. This is not a surprise since they deliberately over saturate an area in order to drive out competitors. Starbucks directly owns its stores so branches don’t have to make money to stay in business. Now that most of its competitors have either died or adapted, Starbucks no longer needs its excess stores or its excess employees. The article concurs.

But last year, as Starbucks sales began to soften, it became clear that the company’s growth was cannibalizing its sales in a way that was threatening the chain’s success, as well as causing the quality at existing locations to slip. Analysts have said that Starbucks lowered the bar on selecting new locations in recent years.

This is oh so hilarious, as Starbucks has long clung to its reputation as one of the “best” places to work. Of course the kind folks at the IWW beg to differ. They’ve been organizing Starbucks locations for years now, with varying degrees of success. But one thing is always the same; Starbucks comes in to brutally bust that union as fast as a cheetah shot out of a cannon.

Starbucks never did and never will care about its baristas. People have deluded themselves into viewing this as some sort of benign company. No company is benign. Capitalism, no matter the form, is always exploitative. Often the friendliest of corporate images cover up the most sinister of corporate practices.

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