Sustainable Business, encapsulated
You want a clear example of the practical difference between sustainable business and business-as-usual? Here is a case study.
Starbucks is starting a TV commercial campaign. According to a story about it on NPR, Starbucks has begun to feel saturation in the fancy-drink segment, and is not yet reaching those customers who are happy to go to McDonalds or Dunkin' Donuts for a $1 cup of coffee. They are hoping that entering the mass-media space will help them reach into these other market segments. It's a whole different business model for Starbucks, which was founded on the principle that some folks will pay a lot for a fancy cup 'o joe.
According to traditional business, Starbucks must continually grow. It cannot fill its chosen niche and then decide to stop. It must trasmute beyond its original purpose in order to maintain quarterly growth for its stockholders. Business does not distinguish growth from development.
If Starbucks wants to develop instead of grow, there are other options. For instance, I would spend more time (and money) in Starbucks if their WiFi was free. So instead of paying for TV commercials and hoping to attract more customers, I recommend they forgo the WiFi revenue with the same goal. Strictly financially, these options are the same.
However, there's a catch: In our single-bottom-line, endless-growth model, it is better to spend more in order to get more revenue than to forgo some revenue in favor of other revenue. This is, in fact, the fundamental problem.
Starbucks is starting a TV commercial campaign. According to a story about it on NPR, Starbucks has begun to feel saturation in the fancy-drink segment, and is not yet reaching those customers who are happy to go to McDonalds or Dunkin' Donuts for a $1 cup of coffee. They are hoping that entering the mass-media space will help them reach into these other market segments. It's a whole different business model for Starbucks, which was founded on the principle that some folks will pay a lot for a fancy cup 'o joe.
According to traditional business, Starbucks must continually grow. It cannot fill its chosen niche and then decide to stop. It must trasmute beyond its original purpose in order to maintain quarterly growth for its stockholders. Business does not distinguish growth from development.
If Starbucks wants to develop instead of grow, there are other options. For instance, I would spend more time (and money) in Starbucks if their WiFi was free. So instead of paying for TV commercials and hoping to attract more customers, I recommend they forgo the WiFi revenue with the same goal. Strictly financially, these options are the same.
However, there's a catch: In our single-bottom-line, endless-growth model, it is better to spend more in order to get more revenue than to forgo some revenue in favor of other revenue. This is, in fact, the fundamental problem.
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