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Jun 20 - Starbucks To Close 150 Stores Amid Rising Min. Wage & Regulations


 
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 11 months ago '07        #1
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MELODY 125 heat pts125
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Jun 20 - Starbucks To Close 150 Stores Amid Rising Min. Wage & Regulations
 

 
As Business Stalls, Starbucks Triples Store Closure Rate With Plans To Shutter 150 Locations



[pic - click to view]

 https://www.marketwatch.c .. ory-2018-06-20




On the same day Starbucks said it would close 150 U.S. stores, voters in Washington, D.C. approved a ballot measure to raise the minimum wage for restaurant workers to $15. It’s not entirely a coincidence.

Faced with more competition and slower sales growth, Starbucks SBUX, -9.72% said it will close about three times as many stores in 2019 as it usually does each year. Reading between the lines, most of the closures are likely to take place in major urban markets in the Northeast and West Coast.

Related: Starbucks says racial bias incident delayed its marketing push, hurt same-store sales

Starbucks CEO Kevin Johnson told Bloomberg News the affected stores are largely “in major metro areas where increases in wage and occupancy, and other requirements or things that were making those stores unprofitable.”

Although it’s not known yet if any stores in the nation’s capitol will close, Washington, D.C. is part of a vanguard of big cities on the coasts that have raised the minimum wage, passed paid-leave laws and approved other costly commercial regulations.

All of those steps taken individually may be laudable , but collectively they add to the costs of running a coffee shop or a restaurant. And in the fiercely competitive restaurant business in which thin profit margins are the norm, it can mean the difference between success and failure — failure that costs jobs.


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Worries about businesses closing and jobs disappearing triggered surprising opposition among the liberal establishment in Washington over the “tipped wage” ballot question. The measure would raise the minimum wage for bar and restaurant workers to $15 by 2025.

Mayor Muriel Bowser, most of the D.C. City Council and top restaurateurs such as famed Spanish-born chef Jose Andres urged voters to reject the measure. Many restaurant workers were also opposed, fearing it might cost them their jobs. It still passed easily, 55% to 44%.

Also Read: China can’t match Trump in a tariff f*ght, but it does have other weapons

Most local restaurants can’t simply pick up and leave, but Starbucks and other large chains have more flexibility. Johnson said “it’s middle America and the South that presents an opportunity.”

No surprise there. Taxes are lower and regulations are less onerous, especially in the South, the fastest growing region in the U.S. There’s been a large migration over the past few decades of Americans residents and businesses from north to south.

More recently, restaurants have increased investment in automation. McDonald’s MCD, -1.30% and Wendy’s WEN, +0.74% , for example, are rolling out kiosks nationwide that let customers make their orders from a machine.

The move toward automation is not just about saving on labor costs, though. For one thing, companies say it’s hard to find good help now with unemployment at an 18-year low of 3.8%. Customers also like self-ordering and buy more food, McDonald’s contends. That means higher sales and profits.

Read: McDonald’s is making a big bet on self-service kiosks

Nor does the shift to automation mean most restaurant jobs are in danger. Businesses may need to hire more people to prepare, package or deliver the food to waiting customers, for instance.

Yet as “progressive-leaning” company like Starbucks shows, businesses are unlikely to stand pat when government raises labor or regulatory costs. And some workers will definitely lose out.

[pic - click to view]




Last edited by MELODY; 06-20-2018 at 11:19 AM..

18 comments for "Jun 20 - Starbucks To Close 150 Stores Amid Rising Min. Wage & Regulations"

 11 months ago '15        #2
PineappleOG 46 heat pts46
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Amid of the tax cuts?


Edit: had to fix cus i’m not smart


Last edited by PineappleOG; 06-20-2018 at 11:24 AM..

 11 months ago '17        #3
yousabitch 1 heat pts
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 PineappleOG said
In wake of the tax cuts??
in the wake of the tax cuts? smh idiot its amid tax cuts

 11 months ago '14        #4
TheRiverStyx 15 heat pts15
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OP officially branded himself/herself a troll with this thread

 11 months ago '09        #5
messy marv stan 5288 heat pts5288
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but i wont slap or prop

 11 months ago '15        #6
PineappleOG 46 heat pts46
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 yousabi*ch said
in the wake of the tax cuts? smh idiot its amid tax cuts
Thanks fam, i use wrong words often you saved the day

 11 months ago '05        #7
StateProperty88 34 heat pts34
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there is like literally 4 starbucks in a 5 block radius of me...we dont need all those

Top 10 most slapped recently  11 months ago '10        #8
tallulahmademe 16 heat pts16
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 StateProperty88 said
there is like literally 4 starbucks in a 5 block radius of me...we dont need all those
i swear i was about to say that.

 11 months ago '05        #9
Fauby 19 heat pts19
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Thought the tax cuts would do the opposite of this Op? What happened?

 11 months ago '07        #10
Damagegadget 495 heat pts495
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ouch some execs garage isnt getting a 2020 model

 11 months ago '07        #11
deucekara 30 heat pts30
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there's 3 around me. 1 in my building, 1 across from my building and 1 across from that building....wish I was lying.

 11 months ago '07        #12
MELODY 125 heat pts125 OP
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 Fauby said
Thought the tax cuts would do the opposite of this Op? What happened?
Tax cuts have broken numerous unemployment records. You should pick up an economics book and understand that government doesn't control strategies of franchise expansion.





 11 months ago '04        #13
deziking 117 heat pts117
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subway is next.

 11 months ago '05        #14
Fauby 19 heat pts19
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 MELODY said
Tax cuts have broken numerous unemployment records. You should pick up an economics book and understand that government doesn't control strategies of franchise expansion.




took a few economics classes in school for my international business degree and marketing degree, something you havent i bet.

Also, wasnt Trump promoting this tax cut for major corporations to create jobs ? and not to cut 150 stores costing probably thousands of jobs?

You guys argue against yourselves every other day...smh

 11 months ago '07        #15
MELODY 125 heat pts125 OP
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 Fauby said
took a few economics classes in school for my international business degree and marketing degree, something you havent i bet.

Also, wasnt Trump promoting this tax cut for major corporations to create jobs ? and not to cut 150 stores costing probably thousands of jobs?

You guys argue against yourselves every other day...smh

The Unemployment Rate in the U.S. Just Hit an 18-Year Low


Jobless Claims Tumble 3,000 in Fourth Weekly Drop







You judge an entire countries economy and tax policy over the handling of one franchise?





 11 months ago '05        #16
Fauby 19 heat pts19
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 MELODY said











You judge an entire countries economy and tax policy over the handling of one franchise?




Im looking at Starbucks, which is huge, closing 150 stores, costing thousands of jobs, a few months after Trumps Tax cuts passed claiming they would spawn more jobs and corporations to grow. Yes, unemployment might be low now, but thats not an answer for Starbucks closing 150 stores.

So are you telling me, since unemployment is low, Corporations can just go and close all the stores they want to and costs thousands of jobs?

 11 months ago '17        #17
Ymmot 17 heat pts17
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 MELODY said











You judge an entire countries economy and tax policy over the handling of one franchise?




This is in part because a lot of people who were jobless left the job market. But you know, use the numbers however YOU want. Also, the economy is thinning out and the facade won't be held up much longer.

 11 months ago '17        #18
Ymmot 17 heat pts17
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This is a good thing. Starbucks serves poison to millions of Americans everyday.

 11 months ago '07        #19
MELODY 125 heat pts125 OP
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 Fauby said
Im looking at Starbucks, which is huge, closing 150 stores, costing thousands of jobs, a few months after Trumps Tax cuts passed claiming they would spawn more jobs and corporations to grow. Yes, unemployment might be low now, but thats not an answer for Starbucks closing 150 stores.

So are you telling me, since unemployment is low, Corporations can just go and close all the stores they want to and costs thousands of jobs?
Corporation flaw. Opening a Starbucks wherever a franchisee sees fit. Nothing to do with the government. Internal issue if the economy is prospering but your business is failing. But you have a business degree?




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