The indefatigable Starbucks (NASDAQ: SBUX) has made another strategic business decision ... it has decided to raise the price for some beverages and reduce the cost for others.
What is the line of demarcation? Complexity. Drinks that take more of a barista's time to make (such as Frappuccinos) will now be priced 10 to 30 cents higher, while simple drip coffee and lattes will be priced 5 to 15 cents lower.
With some Starbucks locations now offering wine, it makes sense that they are beginning to run their stores more like bars. Think about it, the martinis are always priced more than the bottled beers that only require a top be popped. But here's the difference: vodka is (hopefully) pricier than Budweiser! Whereas the base ingredient for Starbucks drinks is the same. Hopefully this move doesn't take away from the baristas' tip jars, if people think they are already being forced to compensate for their "difficult" order.
What say you? Fair or unfair -- to customers or to their own employees? Leave your thoughts in the comments.
Beth works for The Options News Network (www.ONN.tv), which provides daily stock and options commentary. The above comments are not intended as trading advice.
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Reader Comments (Page 1 of 1)
8-21-2009 @ 1:59PM
genesto said...
I would'nt care if Starbucks had the best and the cheapest coffee in the world. I won't step into a Starbucks as long as its owner continues to support the Israeli settlement movement, which is illegally driving Palestinians from their homes and fueling Mideast outrage against the US for its unwavering suppport for Israel and its brutal and interminable occupation !
8-21-2009 @ 4:46PM
Acer said...
@genesto
+1
If only Americans knew what Howard Schultz was doing with the proceeds from the morning joe of millions of people who want nothing to do with his unholy acts.
9-09-2009 @ 4:44PM
Wily said...
PE @ 60 ?? Talk about a bubble.
10-12-2009 @ 7:17PM
E. Anderson said...
I am an old coffee drinker from a long ways back and I really enjoy Starbaucks Coffee. I live in Palm Springs and my best past time is to go downtown Palm Springs, sit outside and people watch while drinking a good cup of Starbucks Coffee.
Thanks: Keep the good coffee pouring