Daniel of Arabica
brew, drink, repeat
Posts Tagged ‘business’
Fighting over the money
And in this corner …
Fighting over the money while the rest of the industry moves forward.
I know many people have great respect for Peet’s. I do, myself — no, really, I’m no longer much into their style but they were highly influential in bringing quality arabica coffee to the buying public — but this sort of high-stakes, big-money style stand-off over sub-par coffee packaging, and the money that can be made with it, just doesn’t fit my image of the quality driven coffee company I once knew.
Sometimes I wish that the Peet’s board of directors’ grand vision would make an abrupt u-turn and that they would forcefully push aside all of the Starbucks-chasing products they carry to re-focus on doing what they do best: sourcing great coffee, roasting it their way and serving it with a focus on quality that, until recently, Starbucks could only dream of (hint: it’s not because Starbucks has gotten any better). The other dream is that what’s left of those core strengths – the roasting end of the business – would spin off and rid itself of this misbegotten money chase. Maybe they need their own Steve Jobs.
Apple didn’t get to where they are today by following the leader – they haven’t been directly competing with Microsoft for years – but became the fabulously profitable and influential company they are today due to an unfailing focus on doing what they do best and damn the rest.
Brewed elsewhere for November 7th
- The Wall Street Journal talks coffee in Asia. Seemingly well researched – at least from a socio-economic-historical perspective – but I don’t think I would call Sumatra an obscure coffee growing region. Taiwan (I had no idea), Cuba? Sure, they’d qualify as relatively obscure in my book. Not Sumatra. Via theshot.coffeeratings.com
- The Shot cuts through the cruft of those absurd Illy/Starbucks rumors: “Anytime someone tries to sell coffee in this country, the knee-jerk media presumption is that they’re going to ‘Take On Starbucks’™”.
- And you thought the “house of mermaid” invented the frou-frou espresso beverage.
Ground Rules – Asia’s Best Coffee
Illy brands itself through independent U.S. cafés
Espresso Twists in Naples, Italy
Brewed elsewhere – November 3rd from 12:33 to 12:33
- Peet’s Coffee buying Diedrich Coffee for $213M – Peet's, in their latest attempt at out-starbucking Starbucks, buys Diedrich and, so, is now in business of making little, tiny, foil-wrapped pouches filled with stale coffee grounds. In other news, Alfred Peet rolls over in grave … twice.
Brewed elsewhere
- Architecture Food = Stable Cafe – What I knew: a café in San Francisco's Mission neighborhood with decent, if sometimes, incosistent, coffee and good food at respectable prices. What I didn't: An architecture firm, mult-use space and commisary kitchen for food-related businesses.
A Commodity of Errors
McDonalds is now Starbucks’ main competitor and Starbucks has nobody to blame but themselves. By opening up so many stores and introducing so many “frou-frou” drinks that they commodified the coffee buying experience, Starbucks gutted the value proposition of buying an espresso drink at their stores and, in so doing, created a monster in their own competitive space by inviting the king of commodified food service operaters – McDonalds – into the business of selling coffee. Starbucks has gone for the big middle ground and given McDonalds a new lease on life in becoming the scrappy underdog in the battle for the palettes of middle-america. Good job, Starbucks.
The wonderful thing about all of this is that Starbucks has made plenty of room for the so called “third wave” of coffee to gain a foothold in the marketplace. The commodification process Starbucks has undergone has allowed other shops to compete on the quality of their product. While Starbucks’ focus in making you an espresso drink is to get it in your hands as fast as they can, others are focussing on making sure that the beverage you are holding in your hand is of a certain quality: that the money you just shelled out is reflected in the integrity of the drink. They are bringing the craft back to the espresso bar. Good job, Starbucks.
In honor of the announcement that Starbucks will be closing 600 stores nationwide, a list of posts on Starbucks here at Dan Markham dot net.
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