While I'm not anti-Starbucks, there are a couple of misconceptions, I think, about big chain practices. The big chains aren't just winning on price or quality. There are good reasons to say that they have an "unfair" advantage.
First, it is said that they win in small markets because the people in those small markets like the low prices and/or quality control better than the generally more expensive local stores. I don't think that's entirely true. Suppose Wal-Mart goes in to a small town, where it competes with the local stores that have been in business for generations. There might be a small clothing store, a hardware store, and a pharmacy, but Wal-Mart competes with all of them.
This might be a town where it really is true that the town just isn't big enough for both businesses. When Wal-Mart moves in, suppose that only 1/3 of the customers prefer Wal-Mart to the traditional small town clothing store. What will happen? If market forces were all that were in play, Wal-Mart would lose, because more customers prefer the small town store. However, that isn't what happens.
Instead, what happens is that both stores lose money. Wal-Mart doesn't have enough customers to make a profit. However, neither does the small town store. The difference is that Wal-Mart has a big corporation that can provide the new store lots of financial backing for a few years. The small town store can't do it. Even though most of its customers stay loyal, enough of them leave that the small town store can no longer make a profit. Small town and Wal-Mart both lose money, but Wal-Mart can afford it. Small town goes out of business. Now, Wal-Mart is the only game in town, and starts being profitable.
The OP referred to a different situation, in which people tried to keep Starbucks out. The free marketeers say that if people don't like the coffee, Starbucks would close. However, it isn't that simple. What some people like is often an atmosphere free of the chain stores and the same blandness that affects modern society. If there's a Starbucks-free neighborhood, people will go there just for that reason. When Starbucks moves in, people will buy the coffee, but business at the little record store next door will go down, because some people won't come to the neighborhood to shop anymore. Starbucks ruins the "atmosphere" of every shop in the neighborhood, not just the coffee shops.
There's another, related, problem. Starbucks attracts a certain clientele. It's possible that the rest of the clientele in the neighborhood doesn't like the Starbucks clientele. Once again, as a result, it isn't as much fun for those people to go to the neighborhood anymore, and all the businesses, not just Starbucks, are affected.
I'm not for restrictions on chain stores, but it is naive to think that they are winning just because people like them better than the competition. Their size gives them advantages that go beyond the supply chain.
You like my new avatar? I thought I was due for a change.
