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“There’s always another store. There’s more than meets the eye.”
— W.H. Auden
A Starbucks closed in Osborne Village, apparently the victim of an escalation of random violence. But is that the real story?
The Macro
If you’re like me, you’ll have experienced a moment of confusion when it was learned that Starbucks in Osborne Village was closing. Why? Starbucks did not issue a statement on the closure on its own; and what it said to the Free Press when contacted was muddy.
A spokesperson said the company “routinely evaluates our store portfolio to determine how and where we can best meet the needs” of staff and customers. The company will review this location to determine that Osborne Village offers a location where customers can be served in a “warm and welcoming environment.”
Let’s unpack everything that Starbucks said — and didn’t say.
First point to consider: there’s little doubt Osborne Village has seen an escalation in random violence. The Osborne Village BIZ has said that an increase in homelessness, mental health problems and addiction seem to be involved in most of the incidents.
Even so, from a purely anecdotal perspective, that location was always packed with people. So, while the neighbourhood might be suffering a bit right now, it is clearly still a vibrant business district within one of the densest residential areas in Winnipeg.
Starbucks in Osborne Village (Ruth Bonneville / Free Press files)
No matter how you cut it, that makes it a good location, with advantages that, at first blush, seem to outweigh concerns about safety. And having travelled quite a bit, I do not accept that Osborne Village is more dangerous than gritty locations I have visited such as Paradise Street in Liverpool, Yonge Street in Toronto or R. do Carmo 2 in Lisbon.
Second point to consider: Starbucks is in crisis. And that crisis has little to do with random street violence.
Last week, Starbucks reported weaker-than-forecast Q1 2024 sales. Around the world, Starbucks’ revenue dropped two per cent, the first time since 2020 the numbers have gone down.
Why are revenues down? Can’t say for sure, but personally I do less business with Starbucks because it takes so long to get a latte when staff are overwhelmed by mobile orders. Perhaps, Starbucks could figure out how to serve walk-in traffic better. Just saying.
The prospects for Starbucks are so uncertain that former CEO Howard Schultz — who remains the company’s largest shareholder — posted a commentary on LinkedIn that ripped current CEO Laxman Narasimhan for trying to fix the revenue problem with the introduction of new non-coffee products.
“The go-to-market strategy needs to be overhauled and elevated with coffee-forward innovation,” he said. Translated, stop worrying about boba drinks and start making better coffee, faster, with better customer service.
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How does all this drama fit into the closure of Osborne Village?
Winnipeggers might have to accept that this city is neither big nor wealthy enough to support iconic retail chains. Remember Banana Republic closing at Polo Park? The store always seemed pretty busy to me, but it seems obvious it wasn’t earning like stores in bigger cities. So, down went the shutters.
Starbucks has certainly closed locations in Winnipeg before. There was very little media attention when it closed the very busy location at Broadway and Donald Street. Was it because the store wasn’t earning enough? Was it street crime? We don’t know because Starbucks doesn’t voluntarily explain these things.
So, street crime is an issue, but the Osborne Village location should be ideal (even with the additional mayhem) for a business that requires a lot of foot traffic and access to major vehicular and transit lines.
Starbucks has left open the possibility the store will reopen. In the meantime, the city needs to figure out a way to make the area safer. Improved social services and perhaps the Downtown Community Safety Partnership could be extended across the Osborne Street bridge? Something needs to be done.
If this was a business decision, and not a concern about crime, then Starbucks should make that abundantly clear. Right now, the real story behind the closure is about as clear as double espresso.
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