Starbucks bows out of Tahoe City
November 13, 2008
TAHOE CITY “-Tahoe City’s vendor of ventis will sell its last beverage today as it joins the list of 600 Starbucks Coffee locations closing nationwide.
In the midst of a mass closing schedule that began in July and will continue through the first half of the next fiscal year, Tahoe City Starbucks is one of 88 to be shut down in California.
In an effort to boost business by weeding out unprofitable stores, the closings mark a turnaround for the company’s aggressive expansion over the last few years.
While many consumers look for ways to cut spending in a wavering economy, many are foregoing their daily gourmet coffee, opting instead to brew at home or in the office.
David Bach, author of Start Late, Finish Rich, outlines these principals in an idea he calls the “Latte Factor.”
According to Bach, the “microdollar industry has perfected the art of separating you from your money.”
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The principles of the “Latte Factor” operate on the idea that consumers pay little attention to minor purchases, never taking the time to step back and realize how much they spend on an annual basis.
As Bach spells out in his book, needlessly spending $5 per day adds up to $1,885 a year.
While Bach’s book may not be welcome on Starbuck’s coffee tables, it is evident people are waking up to smell the coffee. Unfortunately for Starbucks’s, not in their stores.
Bach’s Latte Factor:
$5 per day (the average cost of a latte and a muffin) x 7 days = $35 per week
$35/week = $150/month
$150 per month invested at a rate of 10% annual return =
1 year = $1,885
2 years = $3,967
5 years =$11,616
10 years = $30,727
15 years = $62,171
30 years = $339,073
40 years = $948,611