The Daily Grind

Ubiquitous coffee shop franchise Starbucks has run into problems in its home country of the US with the chain planning to close 600 of its 8000 stores next year.

The closures will displace 12,000 employees, although the company remains upbeat about its future growth.

In addition to serving coffee, Starbucks is just as well known for being a punchline of the joke of their being a Starbucks on every corner.

Contempt by over familiarity is something that fast foods leviathan McDonalds has also experiences, notes the Seattle Times.

When McDonald's crossed the 30,000-store mark in 2001, it was burdened with a dearth of innovation, market saturation and poor control over stores — the same maladies Starbucks investors fear.

As the ubiquitous burger chain expanded, its size helped make it a target of lawsuits, ridicule and envy that Starbucks has only begun to taste.

"Starbucks has been very adept at managing its growth, but for a long time McDonald's was as well," said John Owens, an analyst who covers both companies for the investment research firm Morningstar.

The lesson for businesses here is about guarding a brand's value to ensure that it remains valuable and profitable.

It's extremely tempting for a business owner to continue expanding while profit margins are good, but it's worth being prudent enough to know when to stop and consolidate.

The team at Business Communications Management recalls two Australian franchises that suffered from over expansion the Aromas coffee shop chain of the early 1990s and the Mary Ryan Bookstore chain from the late 1990s.

Business Communications Management can assist business owners looking for business and professional development through our extensive contacts in business and industry