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Starbucks’ Open Bathroom Policy Comes With Heavy Cost, Study Finds

Pedestrians walk by the Hollywood Starbucks Coffee shop in...

Some 18 months after a racial incident in Philadelphia led Starbucks to institute an official policy to open its U.S. coffeehouses and bathrooms to anyone, regardless of whether they make a purchase, a study finds the Seattle giant may be paying a big price for its pledge to be a third place for all people.

Monthly visits to Starbucks dropped 6.8% compared with other nearby coffee shops after the open-bathroom policy was put in place in May 2018, according to a joint study released Tuesday by academics from the business schools at the University of Texas at Dallas and Boston College. The study, conducted in collaboration with the data company SafeGraph, examines aggregate and anonymous cellphone location data from more than 10 million devices between January 2017 and October 2018.

It covers nearly 10,800 U.S. Starbucks locations and measures them against other cafes and restaurants nearby.

“The decline in visits to Starbucks is large and significant,” the 43-page report says.

Today In: Business

Starbucks disagreed with the finding. “As evidenced by our earnings reports, customers are visiting us in record numbers,” spokesman Reggie Borges said. “The study focuses on cell phone user data. What we are seeing is real customers.”

U.S. comparable store sales in the fiscal year through Sept. 29 jumped 5%, including a 3% increase in average spending and a 2% gain in the number of comparable transactions that indicate traffic, Starbucks said in October. Q4 U.S. comparable sales rose 6%, the best performance in over two years. CEO Kevin Johnson said at the time Starbucks continues to see “traffic growth across all dayparts.”

With the free bathroom access, the researchers looked at the proximity of a given Starbucks store to a homeless shelter and found that customer traffic declined at almost double the rate at stores closest to homeless shelters versus those farthest away. The researchers also found fewer citations for public urination in nearby Starbucks locations as a result of its policy change.

Customer traffic wasn’t the only thing that was hurt. The average income of Starbucks’ customers has dropped compared with the average income of other nearby coffee shops, thanks to fewer visits from “its wealthier clientele.” “This would be consistent with them being more sensitive to crowding and the new visitors brought in by the bathroom policy,” the paper says.

Meanwhile, customers who visit its stores spend on average 4.2% less time in Starbucks compared with other coffee shops following the institution of the official policy, according to the research. The decline is also bigger at locations closest to homeless shelters.

“The small number of non-paying visitors who do linger and use tables and bathrooms have an outsized effect on the total number of visitors, who either stop coming and/or spend less time in the store,” the study says. “It’s unlikely that moving from the quasi-public bathroom policy to a completely open public bathroom has benefited Starbucks unless the customers increased their purchase significantly. … None of this considers any extra staffing costs involved in greater bathroom maintenance.”

Read what Starbucks employees have told me about the open bathroom policy.

While Starbucks’ latest results suggest it can withstand any potential negative impact from its bathroom policy, the study highlights the dilemma public companies like Starbucks face: how to engage in “socially responsible” activities that may not align with shareholder interests.

It’s not “clear whether provision of public goods leads to increased shareholder wealth,” the paper says. “At a certain point, stores must decide how much to curtail the provision of the good to non-patrons, who may also actively deter others’ purchases. … The negative consequences of Starbucks policy suggest that profit-maximizing companies will be likely to underprovide exactly for those groups who have the lowest willingness to pay.”

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I have covered the retail industry for well over a decade and written for publications including the New York Times, the Wall Street Journal and Bloomberg News. I have also been ranked as a top industry influencer since 2013. An innate curiosity about how things work and what sets one brand apart from another drives my coverage, described as “a distinct voice in a sea of noise.” I’m noted for my ability to distill scoops of insight from commodity news and create ahead-of-the-curve trend-setting pieces. Interviews with newsmakers or on-the-ground coverage of major events aren’t the only things that interest me. I’m just as eager to take in the stories of consumers. My passion in storytelling goes beyond retail. Originally from Taiwan as an ambassadorial scholar and having penned many columns about life and culture, I’m equally driven by a sense of mission to tell stories that inspire and touch hearts

Source: Starbucks’ Open Bathroom Policy Comes With Heavy Cost, Study Finds

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Will the open-to-all bathroom policy backfire? ‘The Greg Gutfeld Show’ weighs in. FOX News Channel (FNC) is a 24-hour all-encompassing news service dedicated to delivering breaking news as well as political and business news. The number one network in cable, FNC has been the most watched television news channel for more than 15 years and according to a Suffolk University/USA Today poll, is the most trusted television news source in the country. Owned by 21st Century Fox, FNC is available in more than 90 million homes and dominates the cable news landscape, routinely notching the top ten programs in the genre. Subscribe to Fox News! https://bit.ly/2vBUvAS Watch more Fox News Video: http://video.foxnews.com Watch Fox News Channel Live: http://www.foxnewsgo.com/ Watch full episodes of your favorite shows The Five: http://video.foxnews.com/playlist/lon… Special Report with Bret Baier: http://video.foxnews.com/playlist/lon… The Story with Martha Maccallum: http://video.foxnews.com/playlist/lon… Tucker Carlson Tonight http://video.foxnews.com/playlist/lon… Hannity http://video.foxnews.com/playlist/lon… The Ingraham Angle: http://video.foxnews.com/playlist/lon… Fox News @ Night: http://video.foxnews.com/playlist/lon… Follow Fox News on Facebook: https://www.facebook.com/FoxNews/ Follow Fox News on Twitter: https://twitter.com/FoxNews/ Follow Fox News on Instagram: https://www.instagram.com/foxnews/ Subscribe to Fox News! https://www.youtube.com//FoxNewsChannel Watch more Fox News Video: http://video.foxnews.com Watch Fox News Channel Live: http://www.foxnewsgo.com/ Watch full episodes of your favorite shows The Five :http://video.foxnews.com/playlist/lon… Special Report with Bret Baier: http://video.foxnews.com/playlist/lon… The Story with Martha Maccallum: http://video.foxnews.com/playlist/lon… Tucker Carlson Tonight http://video.foxnews.com/playlist/lon… Hannity http://video.foxnews.com/playlist/lon… The Ingraham Angle: http://video.foxnews.com/playlist/lon… Fox News @ Night: http://video.foxnews.com/playlist/lon… Follow Fox News on Facebook: https://www.facebook.com/FoxNews/ Follow Fox News on Twitter: https://twitter.com/FoxNews/ Follow Fox News on Instagram: https://www.instagram.com/foxnews/

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Remember The Changes To Starbucks Rewards? It Turns Out People Like Them

Last April, Starbucks made some significant changes to its Rewards program.Rather than requiring customers to wait until they acquired enough stars for a food or beverage item, it introduced a tiered system, with a variety of rewards at different levels of stars.

That offered more opportunities for freebies. But if you didn’t know to cash in your 125 stars for a free drink before the program changed, you might not have been happy to wake up and find that you now needed 150 stars.

Fast forward six months, and it turns out that the new Rewards system is working out pretty well. On a conference call with analysts last week, Starbucks said that membership in the Rewards program is up about 15 percent compared with 2018.

The program now has 17.5 million members, versus 16 million at the beginning of 2019. Starbucks, which rolled out the program in 2009, has updated it three times since then, earning this version the nickname Starbucks Rewards 4.0.

Today In: Business

In reality, Starbucks chief financial officer Rosalind Brewer said most Rewards members are redeeming 150 stars for a hand-crafted coffee drink. But now that different levels of rewards are available, the company is seeing more activity by occasional customers, and more activity throughout the day, as well as during peak morning hours.

These customers seem more interested in Starbucks’ beverages, and less interested in its food offerings. Brewer said the company’s cold drinks, including refreshers, iced teas, cold coffee drinks and nitro cold brew all are performing well.

“We are pleased that we did add the other layers of redemption, just so that we can expand the excitement of the Starbucks brand to a broader customer,” she said. That’s a promising development as Starbucks prepares to open its newest type of store on Tuesday near New York City’s Penn Station.

It’s called Starbucks Pickup, and it will cater solely to customers who order their drinks via its mobile app. The process is modeled after Starbucks Now, which has become a big company push in China, where Starbucks is bent on expanding its business. In order to use the store, customers must download the Starbucks mobile app, if they don’t already have it. Then, they will select Pickup-Penn Plaza as the location, and place their order.

Once they arrive at the store, Starbucks says they will find their drink via an order status board. Baristas will be there to help if needed, but they are primarily there to make drinks as orders come in on the app. It recommends that customers designate the Pickup-Penn Plaza location as a favorite, in order to save time with their next order.

The first Starbucks Now store opened in Beijing in July, and Starbucks says it plans to expand the concept to other big cities there in the coming year. Collecting that digital information on its customers is crucial to Starbucks, which plans to open 2,000 more stores in the coming year, with half in the U.S. and China. It now has 31,000 stores world wide.

“From the point of the digital relationships, the more we learn about our customer base, the better we (have) been marketing to them,” Brewer said.“And so you will see our marketing become more personalized and that will help with retention and driving frequency in our stores.”

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Source: Remember The Changes To Starbucks Rewards? It Turns Out People Like Them

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Here is a description of the changes in Starbucks Rewards program for April 2019. What is changing, what you need to know and what you need to do with your current rewards stars. Let us know what you think and what you use your Starbucks Rewards Stars on in the comments below. Our Social Media https://www.facebook.com/TnA-Travel-5https://www.instagram.com/tnatravel/

A Starbucks Executive Got a Disturbing Email From A Salesman. His Reply Was Stunning (and Public)

Absurdly Driven looks at the world of business with a skeptical eye and a firmly rooted tongue in cheek. 

Salespeople can often think they’re clever.

Or, rather, that they should act that way.

Too many believe they know exactly how to be your instant friend.

Too many don’t realize they come across as a hybrid of doofus and nincompoop.

In these days of instant digital judgment, it’s easy to ignore them, of course.

So I was moved by a tale told by David Brunelle, Director of Engineering for Starbucks.

He received an email from a salesman, read it and then — I’m guessing here — his eyebrows and lips twisted in disgust.

The email began with painful salesperson-speak:

Hi, David, It’s great to see you’ve been promoted 4 times at Starbucks and have risen from the ranks of Web Developer in 2013 to now Director of Product Engineering. And to do it after your served time in the Navy. Congrats!

Personally, I’d have already girded my critical faculties at the apparent recitation of Brunelle’s resume or LinkedIn page.

Would I be moved to hear this slimy stranger’s congratulations? Only to deleting the email.

Yet Brunelle is made from politer stuff. (It must be your time served in the Navy, David. Congrats!)

The next line of the email, however, tested his patience:

I can’t help myself, what’s your go-to order at Starbucks? I like my women like I like my Starbucks coffee order: Tall, Blonde, Americano…

Seriously.

Yes, Brunelle could have pressed delete. Instead, he chose not only to reply, but to make that reply public.

It was startlingly polite, in the circumstances:

You lost me with this line. Tech can be a challenging place for women. Your statement perpetuates the mindset that women are here for our entertainment. I don’t believe that to be true. This type of statement also makes a few dangerous assumptions: that I’m heterosexual and will relate to the objectification of women, that I’m cisgender and haven’t personally been objectified/alienated, and that I’d feel comfortable objectifying women behind closed doors.

He was just warming up. Next came:

One of my company’s values, that I am deeply committed to upholding is ‘creating a culture of warmth and belonging, where everyone is welcome’. I’m also dedicated to increasing diversity in technology. In order to increase the number of women and minorities in this field, we need to foster an environment where everyone feels safe and supported.

Perhaps, though, it was the last line that expressed — with bare restraint — Brunelle’s true disgust:

It doesn’t seem like our values align.

Of course, it would be instructive to discover which company the salesman works for.

But if you think this sort of thing is an isolated incident, you might want to think again.

These sorts of attitudes aren’t eradicated overnight.

Some might even observe that in a world where powerful elements are trying to turn society back to the days of Mad Men, such sexist guff is on the increase.

It’s heartening, then, that someone in a powerful position at a powerful company chose to display the true nature of supposed sales patter.

I wonder if he was tempted to send the correspondence to the salesman’s boss

By: Chris MatyszczykOwner, Howard Raucous LLC@ChrisMatyszczyk

 

Source: A Starbucks Executive Got a Disturbing Email From A Salesman. His Reply Was Stunning (and Public)

 

Starbucks’ Holiday Cup Offer Gets Off To A Crashing Start – Micheline Maynard

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If you went to Starbucks on Friday and failed to get one of its reusable red cups, you were not alone. And if you tried to get on to its app to order a drink and found yourself locked out, you were not alone, either. A number of customers across the United States complained on social media that they were unable to obtain one of the red cups that Starbucks promised to give them if they ordered one of its holiday beverages. I was among the people who were unsuccessful in nabbing one of the cups, and I still couldn’t log into the Starbucks app late Friday afternoon……..

Read more: https://www.forbes.com/sites/michelinemaynard/2018/11/02/starbucks-holiday-offer-of-a-reusable-cup-gets-off-to-a-crashing-start/#78b5eedab573

 

 

 

 

 

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Activist Investor Bill Ackman Takes $900 Million Stake In Starbucks – Maggie McGrath

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Bill Ackman, the activist investor who took on Chipotle in 2016, revealed Tuesday afternoon that he has turned his attention to the biggest coffee chain in the world. Ackman’s hedge fund, Pershing Square Capital, has taken a roughly $900 million stake in Starbucks. Ackman unveiled the 15 million-share position—a roughly 1.1% stake—at Grant’s Interest Rate Observer conference in New York on Tuesday. His core investment thesis is that despite recent struggles in same-store sales and a less-than-stellar stock market performance…..

Read more: https://www.forbes.com/sites/maggiemcgrath/2018/10/09/activist-investor-bill-ackman-takes-900-million-stake-in-starbucks/#40ef194e41fc

 

 

 

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Starbucks commits to 10,000 ‘Greener Stores’ by 2025 – Olivia Minnock

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Starbucks has announced an initiative to design, build and operate 10,000 ‘Greener Stores’ globally by 2025, with wider aims to help the wider retail industry operate more sustainably. The ‘Starbucks Greener Stores’ framework is being set up to outline comprehensive performance criteria so that the design, building and operation of Starbucks’ locations will set new standards for ‘green retail’ – this will then be open sourced so that the wider retail community can benefit from the framework and work toward the standards……

Read more: https://www.energydigital.com/sustainability/starbucks-commits-10000-greener-stores-2025

 

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See also:

McDonald’s joins Starbucks to develop sustainable products  

Walmart’s 2018 CSR report: 20mn tonne reduction in emissions, sustainable souring and more

Read the latest issue of Energy Digital magazine

 

 

Was Starbucks’ Racial Bias Training Effective? Here’s What These Employees Thought

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One Northern California-based Starbucks barista said she contemplated leaving her job after the controversial arrest last month of two black men sitting at a Philadelphia location of the coffee chain for several minutes without having purchased anything.

That employee, an African-American woman who asked TIME to remain anonymous due to concerns of losing her job, was angry. And when Starbucks later announced more than 8,000 stores across the country would participate in racial bias education training, she didn’t understand why.

“I was angry we had to educate people on how to not be racist,” she recalled in an interview with TIME Tuesday night shortly after attending the hours-long training that shuttered nearly all of Starbucks’ U.S. locations.

But, after completing Starbucks’ racial bias training program Tuesday afternoon with her coworkers, the California-based barista felt her perspective had changed. “I’m a black woman; I’ve already known all of this,” she said, referring to one section of the program that detailed living day-to-day in public spaces as a person of color. “But the fact that it was a video all employees had to watch, it really warmed me.”

More than 175,000 Starbucks employees participated in the mandatory racial bias education program Tuesday afternoon at thousands of U.S.-based locations as part of an initiative spurred by the high-profile incident in Philadelphia last month. Gathered around a few iPads at locations around the nation, Starbucks employees watched nearly two dozen videos featuring the rapper Common, documentary filmmaker Stanley Nelson, Starbucks executives and other prominent figures, while participating in wide-ranging discussions about race and identity with their colleagues.

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The curriculum, released in full by Starbucks online Tuesday night, placed an emphasis on encouraging some employees to become “color brave” instead of “color blind” and meditated on the Starbucks’ responsibility as the “third place” for some members of the community, akin to a home and workplace.

TIME spoke with five Starbucks employees on what it was like to attend Tuesday’s training sessions. These employees shared differing perspectives on the impact of the curriculum and detailed how effective they each thought it truly was.

Jason, the only African-American employee at his Hollywood-based Starbucks location who asked TIME to identify him by his first name out of concerns over job security, said the program reiterated common conversations surrounding race like inclusion, acceptance and understanding.

But he said the training failed to address how to end instances like what happened in Philadelphia from occurring in the future. While a number of the videos featured the perspectives of people of color — and particularly African-Americans — Jason wrote in a message to TIME that “there were times where I felt they missed the mark.”

“It seems like a lot of talking from the videos,” he added, “and not enough discussion from us.”Employees said they were also given workbooks that included prompts for them to discuss their first experiences with racial identity and discuss in pairs questions like, “What makes me, me? And you, you?” The company also gave employees personal journals to write in and keep for the months ahead. The curriculum as a whole, Jason said, could have used some improvement.

“Helpful? [I don’t know],” Jason wrote. “It kinda reaffirms things that I know already.”

Jason was not alone. Mohamed Abdi, an employee at a Starbucks location in Alexandria, Virginia, told TIME he wished the program featured more discussions between coworkers as well. “Honestly I think they should have more hands-on courses speaking to different people and customers to figure out where they’re coming from,” he said. “It’s easy sitting through something and saying you learned something than actually learning something from the course,” he added.

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His reception of the course, however, was generally positive. He particularly enjoyed the documentary produced by Stanley Nelson that displayed “the different things people of color go through just by leaving the house day by day.” That video featured an array of people of color who discussed how they access and experience public spaces than their white peers. (“When I go into stores, sometimes I get followed,” one woman said in the video. “Especially being a teen of color, they assume that you’re doing something bad.”)

The California-based, female employee told TIME that same video strongly resonated with her and — at one point — almost drove her to tears. “I often find myself even at other Starbucks locations where I don’t work at, and when I say I’m a partner, they look at me a certain kind of way,” she said in a phone interview after her store’s training session Tuesday night. “Just the fact that they really touched on that, it definitely made a lot of people in my job who work with me understand better.”

Ryan Curran, a white employee at a Sewell, New Jersey, location, said he and his coworkers learned a lot from the Starbucks training and wouldn’t change anything about the curriculum. “It would be helpful to continue the program when needed, for example, if a problem occurs in a certain store,” he said.

However, an Arkansas-based Starbucks employee who asked to remain anonymous out of concern over her employment, said she couldn’t imagine the curriculum would have much of an impact. “While this may be the most cost efficient way to handle the situation, I don’t feel like it will change much of anything,” the employee told TIME over text message before the training started.

She added that the store she works at initially didn’t plan on closing for Tuesday’s training, but eventually did once Starbucks’ higher ups stepped in. “Just driving an hour down the road takes you to towns where racism is alive and well,” she added.

According to estimates detailed by USA Today, Starbucks likely lost around $12 million by closing its U.S.-based stores on Tuesday afternoon. Since announcing it would close down the afternoon of May 29 for the training, Starbucks has emphasized the session was just the beginning of a long-term commitment to diversity and combating racial bias.

Researchers and social scientists recently told TIME that a one-time education program isn’t enough to combat racism and eradicate the use of racial biases. Hours before the programs began on Tuesday, Starbucks Executive Chairman Howard Schultz said the company plans to globalize these efforts and make similar initiatives part of the on-boarding process for new employees.

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Indeed, in the weeks after Donte Robinson and Rashon Nelson were arrested at the Philadelphia location, Starbucks implemented new policies that allow people to sit in stores or use their bathrooms without purchasing anything. Hakeem Jefferson, a political science doctorate student at the University of Michigan who will join Stanford University’s faculty in the summer, told TIME ahead of Starbucks’ training day that structural and systematic changes like these policies could help prevent “negative outcomes” of unconscious biases manifest themselves

Starbucks’ curriculum, the company has said, is a launching pad for further initiatives as well as a tool for other companies to refer to and a program that may be used in the on-boarding of new employees in the future. But while movements within a company like Starbucks come as the result of a high-profile, racially charged incident, “I think we should worry that that doesn’t lead to the kind of change that we might want,” Jefferson, the social scientist, said.

“This has to be a core component of every company’s mission, particularly in an increasingly diverse world.”

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Starbucks Is Now Open for Loitering and It’s a Terrible Business Decision – Gene Marks

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Starbucks, in an effort to walk back from the recent bad press it received, has just made a terrible business decision. Did you catch it? According other reports, the company, in a letter to its employees this past weekend, said that “any person who enters our spaces, including patios, cafes and restrooms, regardless of whether they make a purchase, is considered a customer.”

Starbucks employees were told to follow company procedures for people that are acting in a “disruptive manner,” particularly when there’s a potential safety concern. The company is also asking its customers to “behave in a manner that maintains a warm and welcoming environment by using spaces as intended, being considerate of others and communicating with respect.” That’s fine for “customers.” But if a guy’s not buying any coffee how can you call him a customer?

It’s a terrible mistake and it should be a fascinating business lesson, not only for the giant coffee chain but for the thousands of smaller, independent coffee shops, merchants and restaurant owners that operate around the country. Why?

First of all, consider my local Starbucks (which by coincidence is the one located at 18th and Spruce Streets in Philadelphia, where the now infamous racial incident that occurred last month). I go there all the time. Unfortunately, so do lots and lots of homeless people who sleep the nights in nearby Rittenhouse Square looking to use their bathroom or to get a cup of water.

The employees at that location are great — always providing but then politely moving them along. (Let’s please not get into a homeless debate here: It’s a terrible and sad problem. But anyone who lives in a city like me knows the best thing to do is to contribute to organizations who can provide food, clothing and medical care for this population.)

Once word of this new policy spreads — and it will spread quickly — my expectation is that this location will be residence for many indigent people…all day long. If you were homeless, wouldn’t you do the same? As long as you’re “considerate of others” and “communicating with respect” (whatever that means) you can sit there from opening to closing and enjoy warmth, security, a bathroom and as much water as you can drink.

It’ll be interesting to see the impact this has on all the other customers who use that location as a place to meet friends, study or relax with a latte and a book. My prediction: Bye-bye, Starbucks.Secondly, what will Starbucks do if the policy fails? Has this really been thought through? Was it even tested during this past month? Please, don’t ever do this in your business.

Yes, we all sympathize with the homeless, but do you sympathize so much that you would sit next to someone who’s been living rough (and smells like it) after spending six bucks on a Frappuccino? And what about their employees? Does the company realize just how much more difficult their jobs will become? Will Starbucks lose valuable people due to the added stress from adding “policeman” and “psychiatrist” to their already long list of job duties? I think so.

There is potentially good news from this decision, particularly if you’re one of the thousands of coffee shop, store or restaurant owners around the country. It’s quite possible that the influx of homeless or other people who aren’t paying but use Starbucks like a bus station waiting room will drive existing Starbucks customers to you.

But then again, it’s possible that the Seattle chain’s supposed “benevolence” may force you into doing the same — or bear the wrath of activist groups, social media trolls and bad headlines. Will this force the many independent business of chains like Subway and Dunkin’ Donuts to do the same? Ugh.

So let’s see how this plays out. I’m ready to buy my coffee at any of the dozens of local merchants nearby if my local Starbucks becomes uncomfortable or undesirable. You know what? I should be doing that already.

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