the Fat Tax

[80sU2isBest]

I don't like the fat tax. I think it is just one more way for the government to punish manufacturers of a legal product.

However, maybe it will do me some good. Maybe if the tax is outrageous enough, I won't buy soda.

 

[Irvine511]

First, let’s note your avatar and it’s context of the foam on Dr. Evil’s nose in the film … and I’ll even put aside your patronizing tone since I don’t think it’s intended.

I think you get the Seattle 1999 protestor pile reaction in that there is a lack of evidenciary proof to support a lot of what is said about the "evils" of corporations - especially when describing intent.

i really can't do any more than i've done. the "Seattle 1999" reference was in response to your snobbish dismissal of Naomi Klein, who i referenced once, and who you deem to be clearly wrong about the situation, even though i'm quite certain she knows far more about this subject than you or i. you have every right to disagree with her, but dismissal is something different.

i have yet to use the word "evil" -- such an adjective is useful for your position, in order to pain the other side as irrational. if you’re looking for “evil” and vitriol, I’m not going to give it to you. i’m quite disappointed in how you’ve caricaturized my issues with Starbucks and ignored the substance. i think the “zeal” with which you read my arguments is more of a reflection of the anti-globalization “zeal” you sense is out there, and you’d like to be present in my posts, so that you might exercise those capitalist mantras we all learned in American economics courses.

intent -- just how do you want me to quantify this? i suppose if you keep your requests for information appropriately vague, you can continue to complain that i haven't answered your questions or come up with facts and cases that support my positions.

in any event, i've identified and explained several business practices used by large chains to bleed their competition and increase market share. But, just for fun, I’ll spell it all out again:

Starbuck’s strategy is to oversaturate a market—it is called “clustering.” It will surround an independent coffee shop with 2 or three locations until the independent store goes out of business. during the 1990s, Starbucks very carefully concentrated its growth in relatively few areas. instead of opening a few stores in every city, it waited until it could effectively blitz a desirable area. the company itself calls "cannibalization”—Starbucks coined this term. what happens is that an area is saturated with stores until the coffee competition is so fierce between multiple Starbucks and the original coffee stores that sales drop even in individual Starbucks outlets, however overall profit goes up—they lose market share to themselves, essentially.

clustering is a competitive retail strategy that is only an option for a large chain that can afford to take a loss on individual store in order to reap a larger, long-term branding goal unlike Starbucks, an independent can only profit from one store at a time. further, Starbucks goes directly to landlords in prime locations and offers to pay them higher rental payments for the same or adjacent spaces, along with $30,000 signing bonuses and offers to triple the rent in some cases.

http://www.metroactive.com/papers/metro/09.29.04/starbucks-0440.html

in sum, what Starbucks—and any aggressive chain—does is erode the market share of small businesses. the net effect is the creation of a retail arena in which size is a prerequisite. fhis is not good news for independents in any industry.

independent stores and restaurants do continue to thrive, and there’s certainly some truth to Starbucks having invented the gourmet coffee market (or at least commodified and packaged what was once a part of Pacific Northwestern culture). successful independents are usually in high-end, gentrified neighborhoods—places where people such as myself, who care about supporting independents, tend to live—while the suburbs, small towns and working-class neighborhoods get blanketed by more Starbucks.

so choice, it seems, is predicated upon geography and income level

all of this is perfectly legal; it's a free market. i have just voiced many concerns about the physical and psychic toll this takes on all of us.

[q]We've gone back and forth trying to nail down specifics. You've got passion and drive, but the dots are not connecting with fact.[/q]


pot? kettle? you've, again, offered me nothing, you've given nothing in defense, except from a single citation, and from that citation, here are some facts to chew on:
 Sales through US coffeehouses have increased by 77% since 1998 to reach US$6.9bn in 2003.
 The number of coffeehouses now exceeds 17,000.
 Chains with more than ten units, such as Starbucks, account for nearly 40% of all coffeehouses.
 independents still have the majority of market share with 57.5%, although this is a decrease in share since 2001 when they accounted for 61.6%.
 the share of chain stores continues to rise as a result of the rapid expansion of industry giant Starbucks, which opened 1,800 new outlets in 2002 and 2003.
 the increase in the number of independents is due to an almost identical increase of 1,800 new single-site independents in 2002 and 2003.
 Starbucks stores account for roughly one third of all coffeehouses, and roughly one half of all sales (approximately US$3.4bn), even when sales from licensed franchises are excluded.
 Starbucks is more than 20 times the size of its closest competitor, Caribou Coffee



[q]To support the argument that coffee independents are driven out of business, you offered trademark cases. While there may an emotional appeal to such cases, the motivations for such cases are far different. Not to mention that the business sited in your articles are still operating.[/q]


What’s important here is not the specific outcome of the cases, but what each of these cases tells us about Starbucks and their willingness to go after an independent distributer of coffeebeans from Oklahoma. this is indicative of their willingness to single out individual companies, anywhere, no matter how small, and try to destroy them through various methods.


[q]You've asked for facts, I've given you facts, you've dismissed the facts, and have not countered with related facts of your own. Again, you come at these issues with great zeal, but the logical and factual assumptions needed to support the positions need shoring up.[/q]


what facts have you given? you've offered a very small increase in the number of independent coffee shops and you call this giving me "facts"? a number independent of any analysis? a number that’s rather meaningless given the totally amount that coffee consumption has gone up over the past 10 years? a number that’s meaningless given the amount of Americans who now purchase their coffee instead of brew it at home?

What’s the most important fact is that there has been a clear decline in the market share of independent coffeehouses that corresponds with the increase in market share of Starbucks.

i've done, far and away, all the work in this thread, and you've called upon me to support my position with evidence, and i have, and you've offered nothing in reponse.

i suppose I shouldn’t allow myself to get bullied like this, but in one way, you’re right—I do believe passionately in things (not zealously), and so I’m going to continue to make an argument whenever I can.

I've noticed that many of the statements end with "meaningful" options or choices. Is this something you can quantify? Is it an objective thing, or a personal choice? What if a choice is not meaningful to you, but meaningful to someone else?

I suppose defining what meaningful choice is would be to distinguish it from selection—a chain gives you selection, multiple stores with unique identities gives you a choice. Further, meaningful choice would involve a greater differentiation between, say, Starbucks and a Starbucks-imitator, Caribou Coffee.

 

[AliEnvy]

but what i do think is critical is to spread awareness and educate consumers about the deleterous effects of one's consumption, and to appeal to a greater sense of social responsibility, so that they might think about how they participate in the system and then self-regulate.

Ah yes, back on topic lol. I agree that education is critical. This thread is not about Big Macs and convenience, it's about how to handle a commercial food ingredient common to just about ANY and ALL prepared and packaged foods - it isn't even labelled clearly as an ingredient most of the time - very deceptive. Consumer boycotts couldn't possibly reach that far.

When an ingredient (like certain pesticides that have been banned for causing childhood cancers etc) is found to be detrimental to human health, how detrimental does it need to be before we do something about limiting it? Where is the FDA in all of this I wonder.

If we can agree that the science says HFCS is a causual link to obesity then how do we limit its usage? Education alone won't cut it, and besides, who will pay for it? The government is subsidizing corn production! Keeps farmers in stable business and the shareholders of food companies happy but is that a socially responsible way to spend public money?

 

[nbcrusader]

I appreciate your humble acceptance of my “patronizing” tone. Perhaps you mistake my lack of reaction to somewhat hostel accusations of non-responsiveness.

You continue to claim to know the Starbuck’s marketing strategy for new store development, yet continue to do nothing more than repeat the emotionally engaging yet factually inaccurate characterizations of the growth of a successful chain. It’s not hard to find these editorial arguments – successful organizations draw them like flies. And I would find it very difficult to believe that Naomi Klein knows more about Starbucks store development strategy than I – I wouldn’t trash her claims unless I knew better.

So let’s focus on the two new items of information you’ve provided. First we have the MetroActive article that looks at the turnover of three independent stores – and stores where only one (!) site later became a Starbucks (the article admits that most of the stories that support your generalized claims are “clouded with exaggeration and lacked specific details”). The article tries to paint a picture of a nefarious corporate giant squashing small independent coffee shops. Instead, we have one independent cashing out a lease (his own business decision), one who paid higher rent (or what they call market rent), and one who could not pay rent (with no evidence of a competing Starbucks in the area).

What I really appreciate about the article is the following statement:

Mike Ferguson, media spokesman for the Specialty Coffee Association of America, contends that it is "fairly rare" for independents to harbor bad feelings about Starbucks. In fact, he explains, "Most independents are seeing their businesses improve. The number of independents in the industry has not changed, even with the growth of Starbucks."

I guess that is the best, direct evidence you’ve provided. Even better, it supports my contentions.

The second set of facts you present show a small reduction in the marketshare held by independents. Never mind that the total number of independent coffee shops is increasing, or that the rate of growth of independent coffee shops is equal to Starbuck in 2002 and 2003. If anything, the fact you present only show a slight increase in growth rate for other chain stores.

So, thank you for the facts.

I’ve already explained the trademark issues and the need for any holder of a trademark to defend the mark or lose it. The David & Goliath characterization of the issue does have emotional appeal. But if a corporation invests in the creation of a trademark, and can lose its rights to the mark everywhere by the actions of one infringer, it would be irresponsible not to stop the one infringer. Why does the fact that someone want to infringe on a trademark (take or steal) not bother you?

It is either fair nor productive to claim you’ve “done all the work in this thread” and I’ve offered “nothing in response”. We can go back, point by point to match your claims and my responses. I would hope this would be a more productive exchange of ideas, not a desire for a “win”.

 

[Irvine511]

I appreciate your humble acceptance of my “patronizing” tone. Perhaps you mistake my lack of reaction to somewhat hostel accusations of non-responsiveness.

perhaps you should respond to questions rather than ignore then, and then say you've responded to them. what type of response do you think such posting engenders?

the 2nd sentence is lovely. re-read it.


[q]You continue to claim to know the Starbuck’s marketing strategy for new store development, yet continue to do nothing more than repeat the emotionally engaging yet factually inaccurate characterizations of the growth of a successful chain.[/q]


here would be a great place for you to tell me how i am factually inaccurate, rather than insisting i am so and then offering nothing in response.


[q]It’s not hard to find these editorial arguments – successful organizations draw them like flies. And I would find it very difficult to believe that Naomi Klein knows more about Starbucks store development strategy than I – I wouldn’t trash her claims unless I knew better.[/q]


so we'll take your word for it.



[q]I guess that is the best, direct evidence you’ve provided. Even better, it supports my contentions.[/q]


again -- you've missed the main point, one that i've repeated over and over and over. the (small) rise in the number of independent coffee shops has to do with consumer demand for gourmet coffees that exploded in the 1990s. Starbucks capitalized on this trend, and did so through the various predatory tactics i've outlined, and yes, they have targeted individual stores. the independents that are improving are the ones Starbucks has chosen not to target -- if you are an independent and Starbucks decides you're on it's hit list, that's it. it's over. and there's little you can do. however, the fact that the rise in the overall number of indepenents does not excuse or justify the deliberate targeting of the independents by Starbucks, and the numbers of independents has increased because overall demand for coffee has gone up, yet, as we've both noted, their marketshare has gone down and will continue to go down.

you've also sidestepped the fact that people away from urban areas where independents do well -- the revitalized urban centers that are increasingly unaffordable -- do not have access to said independents. the suburbs, exurbs, and rural areas are suffocated with chain stores.


[q]I’ve already explained the trademark issues and the need for any holder of a trademark to defend the mark or lose it. The David & Goliath characterization of the issue does have emotional appeal. But if a corporation invests in the creation of a trademark, and can lose its rights to the mark everywhere by the actions of one infringer, it would be irresponsible not to stop the one infringer. Why does the fact that someone want to infringe on a trademark (take or steal) not bother you?[/q]


we're not talking about a trademark -- we're talking about Starbucks trying to commodify a way in which people order a latte, with a "doubleshot." the fact that Starbucks lost the lawsuit is rather indicative of the lack of merit to their suit to begin with -- why bother in the first place? it's not trademark defense. only a fool would confuse DoubleShot Coffe with Starbuck's DoubleShot drink. again, it's akin to Coca-Cola trying to trademark the word "Cola" and suing anyone who attempts to use the word "Cola."




[q]It is either fair nor productive to claim you’ve “done all the work in this thread” and I’ve offered “nothing in response”. We can go back, point by point to match your claims and my responses. I would hope this would be a more productive exchange of ideas, not a desire for a “win”. [/q]


it's not about winning or losing, it's about presenting a substantiated argument, and as others have pointed out, my arguments are far, far more sourced than yours are.

hence, the work done.

if you'd like to provide information, rather than assertions, please, go ahead and do so.

and it would be great if you could somehow tie this into the original intent of the thread. it would seem like much less of a competition if you'd keep on topic and tie your arguments back into the broader points addressed in the original article -- such straying into tangental details belies not a concern with the subject at hand but a wish to one-up the subject making the posts.

 

[nbcrusader]

perhaps you should respond to questions rather than ignore then, and then say you've responded to them. what type of response do you think such posting engenders?

If you plan is to replace discussion with insult, please save it for someone else.

here would be a great place for you to tell me how i am factually inaccurate, rather than insisting i am so and then offering nothing in response.

You’ve made claims, I’ve asked you to back them up. You post editorials, I refute them. You post facts, I show how they actually hurt your basic premise.

again -- you've missed the main point, one that i've repeated over and over and over. the (small) rise in the number of independent coffee shops has to do with consumer demand for gourmet coffees that exploded in the 1990s. Starbucks capitalized on this trend, and did so through the various predatory tactics i've outlined, and yes, they have targeted individual stores. the independents that are improving are the ones Starbucks has chosen not to target -- if you are an independent and Starbucks decides you're on it's hit list, that's it. it's over. and there's little you can do. however, the fact that the rise in the overall number of indepenents does not excuse or justify the deliberate targeting of the independents by Starbucks, and the numbers of independents has increased because overall demand for coffee has gone up, yet, as we've both noted, their marketshare has gone down and will continue to go down.

you've also sidestepped the fact that people away from urban areas where independents do well -- the revitalized urban centers that are increasingly unaffordable -- do not have access to said independents. the suburbs, exurbs, and rural areas are suffocated with chain stores.

Repeating arguments not based in fact does not make them fact. You claim “predatory tactics” targeting independent and “deliberate targeting” of independents. Now, generally we would expect facts to back up such statements. You’ve offered none, with the exception of one article with complaints of three store owners. I noted what really happened in each incident and highlighted language from your own article that said independents were happy with Starbucks. Now, how do explain your repeated claims when independents say they are happy with Starbucks.

For your information, like any commercial real estate endeavor, stores are sited based on demographics and projected sales. Minimum sales goals must be established before a site would be considered. It has nothing to do with the existence of independent stores. I think hands on work experience in this area should carry a little more weight than outside observation or political argument.

Now, your argument (which you claim I’ve somehow sidestepped – you probably should have raised it first before tossing that insult) does not make sense. People living outside urban areas that had no coffee shops (independent or chain) - thus no choices. Now, chain coffee shops move extend to these areas and what? Choice went down? We should be doing something so independents can reach these areas? Chain stores shouldn’t go in because someone else decides not to go in?

we're not talking about a trademark -- we're talking about Starbucks trying to commodify a way in which people order a latte, with a "doubleshot." the fact that Starbucks lost the lawsuit is rather indicative of the lack of merit to their suit to begin with -- why bother in the first place? it's not trademark defense. only a fool would confuse DoubleShot Coffe with Starbuck's DoubleShot drink. again, it's akin to Coca-Cola trying to trademark the word "Cola" and suing anyone who attempts to use the word "Cola."

Actually, you raised trademark cases as proof of Starbucks targeting independents. Your new argument is lacking as well. If there are two Doubleshot coffee’s (one a drink, the other an establishment) and Starbucks wants to protect it’s trademark to “Doubleshot” it has to take action against the alleged infringor. It is not akin to an attempt to trademark “cola” or “coffee”. The more generic the term, the harder it is to enforce a trademark. Doubleshot is not as generic as “coffee”. If you want, I can guide you to some reference materials on the basics of trademark law.

As for the rest, it is not worth responding to empty insults. I’ve followed your lead and responded to your comments. I will post separately to get back to the original topic of this thread.

 

[nbcrusader]

you've also had nothing to say on deleterous health effects of fast food as well as the effect of homogenization upon American culture

Fast food, like most things in life, are fine if consumed in moderation. Focusing on a QSR as a convenient villan makes a nice, tidy political argument, but it fails to fully address the goals presented.

We really need to identify what health goals we are trying to achieve and what items are specifically contributing to significant, measurable health problems on a consistent basis (like smoking, where even one cigarette has a negative impact on the body).

Should we tax specific foods, regardless of the source (fries from a QSR and from a nice restaurant have the same health effect)?

Should we target process foods sold through grocery channels?


As far as the "effect of homogenization upon American culture," how is that measured? Is it necessarily bad? Americans tend to value consistency. In a world full of independent outlets, how do we know one is good as another? The success of large chains does not occur despite the desires of the public, but in response to the desires of the public.

 

[nbcrusader]

The problem I had with Irvine's argument was that he seemed to be implying a level of "evil intentionality" in the corporate world that I had a hard time believing was really there. Well, he I felt he addressed that pretty well. Based on Irvine's response above it would seem corporations do use destructive tatics to their competition, it's just that the people who make those kinds of decisions don't tell themselves that's what they're doing.

There are plenty of laws on the books governing unfair business practices designed to prevent the true application of "destructive tactics". If they occur (and they do) action is taken.

A careful balance is maintained. We want companies to vigorously compete with each other. Discourage that and you move towards cooperative situations that can act like monopolies.

Missing from the equation is the fact that not all business are run equally well. Poor management often leads to the closing of a business or a significant downturn in sales. It is the rare exception that a manager simply admits poor performance.