Friday, November 02, 2007

How to lose money in Shanghai


From AllRoadsLeadtoChina I learn that one of my favorite Starbucks outlets at Nanjing Xilu has moved. I have not been there a lot recently, so that is probably why they could not afford to hang on anymore. Mont Blanc (what do they sell again? It must be fashion.) has taken over this hot spot of real estate. Rich provides us with some amazing details about the costs of the operation:

Where this gets mind boggling is that it turns out they are paying 11USD/meter/day. that is 11 USD … PER METER… PER DAY.

Now, at 800 - 1000 meters of space, that adds up to a whopping amount of rent every month that I would guess is over 250,000USD a month… and you know what that means…. all those hawkers on the street with their Mont Blanc pens are gonna have to go. Cause Mont Blanc is gonna need to sell a lot of pens and cuff links to make their overhead.

Rich is a very well-informed blogger, so we take his word for it. That is very hard to make on coffee only, but seems even for a flagship quite a lot of money. I guess that next year around this time my Starbucks is back in action.

1 comment:

Anonymous said...

Hi Fons,

the calculation is a pretty rough one. 500 meters at 11USD a day (165k a month) + 500 meters at 5.5 a day (82.5 a month) + 2.5 USD/ m per month for management (although I am sure they are higher... so 250k USD.

I must say the next Sbux is nice downstairs, and unlike the old one you can scam wireless from Wagas!