Starbucks had 425 stores in 1994, its twenty-third year in existence. In 1999 it opened 625 new stores. By 2007 it was opening 2,500 stores per year—a new coffee shop every four hours. One thing led to another. The need to hit growth targets eventually elbowed out rational analysis. Examples of Starbucks saturation became a joke. Same-store sales growth fell by half as the rest of the economy boomed. Howard Schultz wrote to senior management in 2007: “In order to go from less than 1,000 stores to 13,000 stores we have had to make a series of decisions that, in retrospect, have led to the
...more
