Bristly Pioneer said:
Because that is an over simplified view of what happens, and assumes it's a level playing field. Unfortunately what tends to happen is starbucks move into an area, and operate at a loss (subsidising this by their other profitable stores) they have a marketing budget of millions and can afford to chuck on bundles of staff to give out coffee in the streets etc.
Starbucks open several stores in an area and the local's share of the pie is squeezed smaller. They have even been known to offer higher rent to independent shop's landlords to move them on, and let starbucks move in. Eventually the smaller non-chain shops can't compete and close down. Starbucks can then buy up the property, or just sit tight as they watch the other local stores go the same way.
Before you know it, there are a dozen starbucks and no local alternatives left. Not everyone is conscious about the choices they make and the effects that they can have on the area. So we thought we would try and highlight what's happening a bit.
I think that is in itself an oversimplification. What happened here, was that Starbucks started the 'coffee industry'. Before Starbucks, you had restaurants that of course served coffee on the menu, but it was a beverage consumed with a meal, for the most part. You didn't see people walking through the streets with paper cups, or plastic mugs full of coffee.
There were some small, mostly italian run stand alone shops in certain areas of the city, that had their own clientele.
What starbucks did, was create the coffee shop as a destination, in the city at large. A number of copycat operations, both chains and individual stores, opened up. We became aware of the idea of the barista, for better or worse. And those shops on Commercial Drive, run by the italians, continued to thrive, because they produced a superior product.
Also, if you check, you'll realize that Starbucks isn't cheaper than stand alone places, or at least, it certainly isn't in the many NA cities I've visited. The little sole proprietor shops seem to be able to sell it cheaper. Also, Starbucks sells a lot of more expensive products, like the ice drinks, etc, that the small businesses don't sell.
There was a big controversy here when starbucks opened up a place on Commercial Drive, the italian coffee area. It was not to worry: all the italian places continue to do great business; the starbucks isn't hurting, but they haven't opened another store on that street. My guess is that business is ok, but not that great; otherwise they'd try saturating the street, like they've done elsewhere.
If your little shops sell a good product, they'll be just fine.