Competing as Starbucks

I think that Starbucks would be part of a perfect competition market because they have good coffee, loyal customers, and they are everywhere in the world.  Starbucks realigned their business practices because aside from being fast and efficient they want to still provide the intimacy and romance between the customers and the baristas.  A large amount of their stores closed because they weren't making a large enough profit and the unnecessary amount of Starbuck locations minimized the intimacy for the customers and baristas.

By shutting down several stores, Starbucks reduced their costs as well as their profits.  I do think that Starbucks coffee is overpriced; however, they can get away with it.  There is a large demand for their product, Starbucks provides good quality coffee, they are fast and efficient, and they have stores almost everywhere.  If Starbucks were to decrease their prices they would sell more coffee.

This graph represents how the price of coffee effects the amount that is being sold.

http://www.google.ca/imgres?imgurl=http://www.mbs.edu/home/jgans/mecon/value/media%2520%2520files/static%2520graphics/jpegs/Segment%25203/3_2_static_market_demand.jpg&imgrefurl=http://www.mbs.edu/home/jgans/mecon/value/Segment%25203_2.htm&usg=__65wNKtDLDPPFPbKf0y_NNlTdHk8=&h=250&w=225&sz=29&hl=en&start=10&zoom=1&tbnid=PfPyvAZkwgUKLM:&tbnh=115&tbnw=101&ei=6KCkTZ_YE4nUgAexruWHCg&prev=/search%3Fq%3Ddecrease%2Bprices%2Band%2Bincrease%2Bquantity%2Bgraph%26um%3D1%26hl%3Den%26sa%3DN%26biw%3D1076%26bih%3D404%26tbm%3Disch0%2C458&um=1&itbs=1&iact=hc&vpx=742&vpy=52&dur=14430&hovh=200&hovw=180&tx=96&ty=126&oei=2qCkTeTmJ6-H0QHE6NjdCA&page=2&ndsp=12&ved=1t:429,r:10,s:10&biw=1076&bih=404

Other links used:

http://starbucksgossip.typepad.com/_/2007/02/starbucks_chair_2.html

http://www.cbc.ca/news/business/story/2008/07/01/starbucks-closures.html

http://seattletimes.nwsource.com/html/businesstechnology/2008028854_starbucks02.html