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Why would starbucks be against lowered supply prices? Either the whole market drops in price and starbucks keeps the same profit margin but lowers actual price,
by setr 9y ago
Why would starbucks be against lowered supply prices? Either the whole market drops in price and starbucks keeps the same profit margin but lowers actual price, or starbucks just sells the same price but now with higher margins than before
- kuschku 9y agoBecause Starbucks has found a carefully balanced point between being affordable enough that it has mainstream appeal, and expensive enough that it seems premium. Any change, absolute or relative, would reduce their margin.
- philh 9y agoDo you claim that the current price of coffee beans is the price that happens to maximise Starbucks' profits? (This seems implausible to me, unless Starbucks has fairly strong control over the price of coffee beans.) Or is your claim more narrow than that?
- kuschku 9y agoMy claim is that the current price of coffee beans happens by coincidence to be close to the optimum for Starbucks’ profits, and any major change would be a disadvantage.