Welcome back Schultz

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I love Starbucks. I go there every morning for my grande non-fat latte. Howard Schultz is putting himself back in charge of Starbucks because the business has started to show signs of underperformance. It is seeing its first “dings” after many years of astonishing – Harvard business case — growth. The slowing of sales is generally attributed to overbuilding of stores and McDonalds coffee product (new and planned.)  
 
Starbucks store build out has probably been too fast, (remember Krispy Kreme?) so Mr. Shultz plan to slow store growth is a good one. And cutting underperforming stores is also a smart move. Either the demographics and geographics support the Starbuck’s experience or not. But McDonalds? And its new espresso bar? I think not. The Starbuck’s core customer doesn’t want to smell Egg McMuffins and canola oil potatoes thingies while waiting for their Ethiopian blends. Not a competitor. Please.
 
Starbucks might consider offering a “value” coffee-of-the-day to staunch the migration of people on a weekly budget, but please don’t be worried about Mickey Dees.
 
Mr. Schultz will do just fine. Welcome back.