i don't think the increase of price in the starbucks coffee drink will affect the people's decision from buying it. if the taste of the coffee is still good and "worth it", i don't think people will mind to pay a few cents more.

yes i do think rendevous can survive in the competition. many people still enojoy it and there's different types of food in rendevous compared to starbucks. if some people prefer food at a cheaper price, then probably they will choose rendevous instead of starbucks.

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What I recently learned in a Korean Academy was that Starbucks is a 'Masstige' product. Masstige is the combination of the words "mass" and "prestige product." Masstige is simply the popularization of prestige products. These people who use the masstige marketing idea know that rich people don't just buy expensive things, and poor people don't only buy cheap things. I think Starbucks really fits this masstige product. Starbucks I believe mainly targets people like the students at SAS, and people who fit into a more wealthy population of the world. Starbucks continuously raises their prices, but people continuously buy them. Having a cup of starbucks coffee, I know most people drink it for the taste, but some also probably like that 'feeling' of drinking the STARBUCKS coffee. Starbucks has made their products seem very high class. It is a problem in Korea, where some people eat a 10 rmb cup noodle for lunch, but drink a 50 rmb Starbucks coffee. I personally think it is not wise to drink a 50rmb, or even a 30rmb coffee. I don't think I really explained the masstige product concept well, but other examples could be something like Haagen Dazs. This marketing strategy I think is really sneaky and tricky, but I think it works really well.

Increase in the price will DEFINATELY influence people's decision to buy their products. A coffee that was 27rmb before, if it is 30rmb now, people certainly will drink it, but maybe less than before.

There is no free lunch. Everything has an opportunity cost. The resources used, which could have been used for something else, the energy needed to get that free lunch, and mostly if you are eating a free lunch with Mr.Welker, the cost would be having to see him.

I really hope Rendezvous Cafe will survive, and I think it will. It offers what Starbucks doesn't and I think their bubble tea has been a real hit. The 2 for 1 idea, and many other strategies has made me think that it is reasonable and fairly cheaper than other restaurants.

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# What kind of market structure do fast food/coffee restaurants have? Explain. How do they compete with each other.

# Will an increase in price of Starbucks coffee drinks affect people’s decision to buy coffee from Starbucks? Why? Why not?

# Is there really such a thing as a, “free lunch? Explain.

# Can Rendezvous café survive given its competition?

1. Starbucks had become more and more popular among the chinese people in mainland china as the average income rises during the transition and fast-growing stage of China and China's economics. Starbucks is clearly affordable by students from our school, and everyone who lives in luxurious houses in zhudi. i think it's pretty smart of them to come into zhudi, since zhudi is not very developed yet.

2. Fast food and coffee shops basically have pretty similar market structures, since Rendezvous and johnny moo and starbucks are located just around our school, they have to do very careful market researches about what students our age likes, and since its near forest manor and SRC, perhaps what foreigners likes too. they might've noticed, students who go to those restaurants are usually, if not always, in a hurry. we only have one or two tops class periods to eat and travel there, serving foods faster should be listed in their

considerations.

3. Yes. a 3-5 kuai raise is a lot for a cup of coffee, i wouldnt spend 30 kuai for a cup of latte if i know it used to be 25. especially in countries like china. economically put, marginal cost exceeds marginal benefits/utility. exception for caffeine addicts.

4. NO! NO FREE LUNCH! SOMEBODY ALWAYS HAS TO PAY FOR IT! haha. this is what i learned in the first ap econ class. NO. NO FREE LUNCH. even if someone else pays for your lunch, there are opportunity costs. the time u spent eating that food is not free. you could be doing something else.

5. Yes, i like rendezvous, and it is the only restaurant in that area that serves chinese food and "bubble tea" that everyone loves. it has all sorts of discounts, breakfast specials, business lunches…etc. and its opened by Taiwanese. haha. go Taiwan

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their choice of increasing the price of Starbucks coffee even more is definitely going to affect how much customers they get. Even if SAS students like to splurge at times, I really doubt that they're going to be buying lattes that cost over 30 kuai, when Rendezvous right beside it, sells it for a lot less. I think it is because of this that Rendezvous will survive. Their food might not be awesome, but the prices are certainly more reasonable than Johnny Moo's or Starbucks (not to mention the fact that they're a bit healthier as well…but just a bit).

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I think that Rendezvous' move to renovate the Cafe shows that Rendezvous is flexible to the demands of the market. The marginal cost of Rendezvous' renovation is outweighed by the marginal benefit of gaining customer satisfaction, which in the end, is what will have Rendezvous customers coming back.

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2． The market structure of fast food/coffee restaurants are very similar. The reason why they are the easiest of the food restaurants to make profits is because of the “fast food” label they have. They are able to take the order, make it, and then give it to the customer very quickly. It’s this quickness that makes it possible for some to have a drive-thru where you order your food at a window and pick it up at the next. This is part of the reason why some of the biggest names in the food business includes McDonalds, Burger King, and Starbucks to name a few are international icons all over the world. This ‘fast food’ label, helps many consumers narrow down their choices from the regular restaurants. Because of economics, they also compete with each other. They compete for customers at their location. They do this by constantly adjusting their menu to try to suit the consumers’ needs, tastes, and local trends; and if they have to may lower their prices if they are seriously desperate for customers.

3． It all depends on how much the price of Starbucks drinks increase. If the increase is a lot, yes, but if it is slight, no. Because a lot of Starbuck’s customers are Western expats, it won’t matter if the price is increased slightly. If I drank coffee and it raised by a price no greater 5 kuai, I probably would still buy Starbucks coffee. The locals would probably think Starbucks would be too expensive anyway so they are out of the picture. If the prices continue to increase, it probably wouldn’t matter anyway because us teens will spend it if we have it. It’ll take a huge increase of the price to force us to back away and look at other options and go back to the school coffee. The people that would be affected the most because of the price increase would be the adults because they typically are more money cautious and are the money earners of the family. A huge increase would only happen over a long period of time so if and when that increase does happen, most of us using this wiki will not be in China.

4． No, there is no such thing as a free lunch. All of the resources used to make that lunch will have cost something. Because of opportunity cost, any resource used to make that lunch, either capital, consumer, or entrepreneur will have been used at a cost of something else. If that lunch had not been made, the resources used could have been directed to create something else that can be of use to the society. The person getting the free lunch may be happy because he or she did not have to pay a cent, but another person from the group distributing the food may not. Because of scarcity and the limits on the resources on this planet, anything made would have been a sacrifice of something else.

5． If there are no more new openings, Rendezvous stands a pretty good chance of surviving the competition from Johnny Moo’s and Starbucks. If you ask most people, they would say Rendezvous is a whole lot better than JM. Starbucks and Rendezvous aren’t really in competition because one has coffee while the other has coffee and good food. The only competition Rendezvous receives is from JM. Rendezvous has been at Zhudi for a long time and it is very common to step into the restaurant and see both expats and locals alike. JM, on the other hand has been in operation far shorter than Rendezvous across the street. The food at JM is practically the same as Rendezvous, and people usually don’t want to change unless the new place is a lot better and JM isn’t.

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2)Fast food restaurants and coffee shops rely on good advertising and loyal customers. They use advertisements that appeal to your senses. They give away free merchandise to keep you coming for more.

3) I don't think the increase in price will do much damage to their income. However, the number of customers they receive might decrease by a small amount. Those who are loyal, who are addicted to their coffee most likely will continue drinking Starbucks.

4) There is no such thing as a "free lunch". Somebody has to pay for that product. The free gift from Starbucks had to be purchased by them to give out for free. It had to be made with ingredience that also had to be obtained and purchased. Time was taken to create the clay.

5) Rendezvous cafe will survive mostly because of their unique products that Starbucks doesn't have. It has great food, especially chicken strips and you can only get the same ones there. It is also the one place that sells bubble tea. It has tons of loyal customers and that won't change because of a mere coffee shop.

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2. Fast food restaurants rely on brand name to get customers. There are loyal customers who always go to the same restaurant, and there are customers who go to the restaurant just because they heard that it was famous.

3. An increase in price will probably cause the amount of money they make monthly decrease, although not by much. They will lose the customers who just buy a cup of coffe to quench their thirst. On the other hand, most people, who are zealous coffee drinkers, will continue to buy their coffee even if the price is raised. Also, people who live near and want to drink coffee will have no choice but to buy their coffee, as they do not have another coffee shop to go to.

4. There is no such thing as a free lunch. Although it may seem like you're getting presents or free gifts, it is always at the cost of something. Even if you're not paying a cost, someone is. In this case, your kids are getting a "free lunch" that Starbucks is paying for. By giving your kids the clay, they will want to go back to Starbucks, which means that you have to buy coffee, which costs about 35 RMB, much more than the cost of the clay.

5. I think Rendezvous will survive because Starbucks is more of a coffee place while Rendezvous serves burgers and meals. Rendezvous might lose some customers, but not much. The Rendezvous fans will still go to Rendezvous. Also, no matter how many new restaurants open up, so far, Rendezvous is still the only one that sells bubble tea.

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~The whole effect is like a rolling snow ball. Since schools and houses have established themselves in town, people become more concentrated in the area. More people equals a bigger market. Starbucks chose to come in because it foresees potential in the market.

<!–[endif]–>What kind of market structure do fast food/coffee restaurants have? Explain.

~Locally, fast food relies on reputation of the quality of food, so does coffee shops. Also, customer-friendly policies attract people.

How do they compete with each other.

<!–[endif]–>Will an increase in price of Starbucks coffee drinks affect people’s decision to buy coffee from Starbucks? Why? Why not?

~Well, Starbucks technically has a monopoly on coffee, or I should say the only shop that specialize and is known for coffee. So without other prices to compare to, people will most likely be willing to pay a few extra quai.

<!–[endif]–>Is there really such a thing as a, “free lunch? Explain.

~As Ms. Close explained, there is no free lunch. It may be explicitly free for the person getting the free lunch, but somebody else had to pay for it. And there is also an implicit cost of a free lunch, for example the act of repayment.

<!–[endif]–>Can Rendezvous café survive given its competition?

~Personally, I don't like Rendezvous's food. But that's not significant to its survival since quite a few of my friends like it there. I think it will survive just because it's not competing in the same category with Starbucks. Rendezvous would be for a quick meal, and Starbucks would be for a quite drink or dessert.

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2. Fast food restaurant and coffee shops tend to rely on their brand name to sell their products, they compete mostly by coming up with new ideas and combinations. Most of these stores will spend money on advertising.

3. I think people will keep going to Starbucks, most of the people won't mind as long as the price increase is not significant.

4. I used to think there's free lunch when other people give me stuff for free. But after the class, i know that there's no such thing like "free lunch", everything comes with an opportunity cost.

5. Yes, because most of us are used to the food, and they have nice services, so i think the Rendezvous cafe will be fine.

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2. They are usually based on advertising and opening many different branches all over the place. this would allow people to get to know the brand and thus, eventually pick this "popular" brand, that they have seen everywhere, over something that they have never seen before

3. I do not think so. Most people who already pay for a starbucks would prolly not think much of a price increase. Star bucks was not cheap in the first place and thus, those costumers who think starbucks in expensive would not have gone there in the first place.

4. No there isn't. This is because people and companies sacrifice something for a greater benefit in another area. For example, if you really want friends, you would sacrifice some money to buy then lunch and then they would be your friends. Thus, both people benefit.

5. It probably will. This is due to the fact that some people think that starbucks is not worth the money. These people would gladly hang out at the Rendezvous café. In addition, if starbucks gets too full, people would think of Rendezvous café as another hang out option.

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2. Fast food resturants and/or cafes have an oligopoly. They compete with each other through advertising, as said above numerous times, and through product differenciation; which starbucks does, being a well-known american coffee company that serves imported coffee, and is well advertised.

3. To some consumers it will, and to some consumers it won't, it depends how addicted the consumer is!

4. No, all goods have some cost, monetary or opportunity.

5. Yes, but they will not sell any coffee!

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They establish a well recognized and well known brand that is distinguished from the rest of the competition. They are also convenient and accessible. They compete with each other through their food products, environment, pricing, promotions, and advertisement.

No, because most Starbucks’ coffee addicts are willing to spend an extra 5 kuai for a good cup of coffee. There is a high demand for it, and 5 kuai is not enough to make customers buy another brand of coffee.

Most “free lunches” might be given if you purchase a certain amount of things or it requires you to buy another product. Even if it is offered to you free with no-strings attached, it is just a marketing technique to make you buy their products in the future. However, as we learned in the AP econ book, these free products are “never free to society.”

Yes, because they offer different items and are targeted towards different markets. Starbucks is more of a “hangout” place for people to relax and chat around with friends. Rendezvous is a family restaurant and offers meals not just desserts, snacks and drinks.

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2. Normally they spend a lot of money on advertising to get customers to choose their products instead of their competing equivalents. They build their brands to stand out and to attract customers.

Franchising is also very common, e.g. for fast food restaurants such as McDonalds. Centrally, they have put in a lot of effort and money to become a familiar brand to all consumers and the offer a “concept package” to the local businessman: nowadays you do not have to look for long to find a big, shining, yellow “M” downtown and immediately connect it to the food McDonalds offers. However, it is the local businessman, the franchisee, who takes the risk of failure of the particular, local, restaurant.

3. No, at least not in the Zhudi area where Starbucks offers coffee and tea drinks you cannot find elsewhere. In the city it could be different but I believe that if you normally pay 25-35 RMB for a cup of coffee, then a few extra RMB will not matter. Also, a higher price may attract customers because they think they buy a more exclusive product. There is also a certain amount of loyalty among customers to stick to the brand they have first decided they like.

4. No, there is not. Even if you don’t have to pay for the lunch someone else will, normally producers or manufacturers. And they will seek to get their money back somehow. A result of the free lunch is probably that you will visit the place again and then by paying (over price) for your food, the company will get back its money.

5. Difficult question. I tend to believe so because Rendezvous has many different meals to offer which Starbucks does not and also I believe Rendezvous may already have built its own, loyal, customer base. The question is really how many of Rendezvous’ customers have chosen that restaurant because there was not a Starbucks close by and how Rendezvous will act now that it has competition. It may to choose to increase its offerings compared to Starbuck’s menue.

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