On that Starbucks makes no profit thing

Papa John’s is poised to make its first UK profit after 13 years

Oh my, is that really how long it takes?

On this side of the Atlantic, competition is intense and Domino’s and Pizza Hut have been dominant. Nonetheless, Papa John’s is poised to make a profit for the first time since it entered Britain in 1999 through the acquisition of the Perfect Pizza chain.

So, err, Starbucks not making a profit here for years isn\’t really all that remarkable, is it?

12 thoughts on “On that Starbucks makes no profit thing”

  1. So Starbucks picked (out of what must be hundreds or more of companies with similar loss times) because they are an easy target?
    Hey, any British companies tried going into a foreign market by taking over an existing company have similar fun making a profit locally?

  2. This tax thing is another example of the two mentality split in society;

    wealth-consumers against wealth creators
    fact-ignorers against fact-demanders
    envy against admiration
    undoers against doers
    prejudice against analysis
    entitlement over all against self-reliance first

    A total lack of awareness of where wealth comes from, what business and trade are about and the reality of our unbelievable standard of living (despite the current crisis) highlighted by the ‘but he/they/she shouldn’t have so much and so they must be crooks’ signature tune.

    Sometimes, business takes time. If I were a tax inspector, I would be heartily pi**ed off by the constant calling into question of my professionalism.

  3. Staurbucks have the misfortune of being the No. 1. The Economist had an article a decade or so back about how it was sometimes beneficial to be the 2nd largest company in a given field, as you tend not be the target of protests and other actions. Tesco tends to get hammered more than Sainsbury’s or ASDA, Microsoft used to get bashed about more than their competitors, but now Apple has reached the top spot I notice they are becoming increasingly under attack from various quarters. ExxonMobil and Shell are public enemies no. 1 in the USA and UK respectively, although BP’s accident rate over the past 10 years has ensure they have been getting plenty of stick as well. But how many protests are there against Total or ConocoPhillips, for example? Being top dog has its dangers as everyone wants a piece of you, and I suspect Vodafone, Starbucks, etc. are all feeling this.

  4. just how profitable have any ventures by UK groups into the USA been? I recall Hanson Trust had problems, despite White basing himself over there; all UK banks have had issues and write-downs from the US (remember Crocker?); Tesco also seems to be struggling.

  5. Wow Starbucks doesn’t make a profit. Imagine that, I mean thier coffee is awful to begin with, I mean really terrible, the sort of thing that only an American would drink.

    They then put one on every street corner in central london, which has some of the highest rents in the world, have to invest in a whole bunch on infrastructure, shop fronts distribution network etc. Then have an average sale price of about £4.00 per customer and wonder why they don’t turn a profit.

    I know from personal experince that when a multinational fast food chain opened its operations in Australia in the early 1970s they did not become profitable as a group until the early 1990s due to the capital investment, expansion etc etc.

    So to make a profit after 13 years isn’t all that bad.

    The protesters are simply ignorant twats.

  6. We’ve been through all this. Starbucks turns its European profits (which it reports to shareholders) into losses (which it reports to the tax authorities) by charging unrealistically large royalty fees. The protesters have got a point.

  7. Pardon? Starbucks operates its own coffee shops. The market royalty rate would be one which allowed the payer to make a profit. Whereas Starbucks UK reports a loss.

  8. Yes some shops are the company ones and some belong to others under a franchise model. Used to be a franchise fair a few years back (could still be running) where numerous big companies offered franchises.Including starbucks.

    Starbucks UK reports a loss – for which there can be many reasons. Not unknown for companies to report a taxable loss for years. Hell, doing that myself due to expansion.

  9. MD: I don’t think so. I googled it and found

    Starbucks has recently revealed it will open its first Starbucks franchise in the UK before the end of 2012

    So if Starbucks was offering uk franchises a few years ago, it found no takers.

  10. Indeed there may have been no takers. Just offering a franchise doesn’t mean its attractive enough compared to others to have someone risk a large sum of money into one.

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