It seems that the pot is scorched for Starbucks, but I don't think it's completely a lost pot of coffee for them.  To fix the situation and turn it around, they need to implement a few things.  First of all, they need to identify and reward loyal customers.  As a resident of San Francisco, I am one of the many that justify the $3.20 a day latte with "well at least I'm not buying Meth or cigarettes." and its just apart of my budget.  However, I've noticed that despite my everyday patronage and seeing the same baristas day in and day out that I"m not rewarded for my patronage.  Its almost expected that I plunk over $3.20 a day.  What about instituting a "Buy 10, get 1 Free" kind of program?

Also, I have no idea what it costs to produce a cup of coffee, but I imagine that they could lower their prices and still make a decent profit.  Perhaps they will need to do so in order to stay competitive with Dunkin Donuts and McDonalds.

I'll be the first to admit that I'm not happy about my $3.20 a day latte habit, and I'd love to break the vicious cycle.  If Dunkin Donuts miraculously emmerged in California, at least it woud costs me less money!