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Starbucks Industry Analysis Essay

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Industry Analysis A. Basic description of the industry. 1. In Seattle in 1971 Starbucks was founded as an American corporation. 2. Starbucks is a retailer, marketer, and premium roaster company. They are known for their specialty coffee around the world. 3. Starbucks has approximately 182,000 employees in 62 countries around the world. 4. The geographic location of Starbucks is worldwide. 5. Revenue for Starbucks is $16.45 billion. B. Factors that influence demand. 1. Starbucks makes up much of the market share, and this gives them a lot of market power in determining the industry trends. 2. The industry has it rough when we are discussing demand. Starbucks demand is driven by the attitudes of people at the time according to how they are …show more content…

Since the size of Starbucks to so large they have the power to take full advantage of suppliers. This makes the power of suppliers low. ii. The size of Starbucks also helps keep the power of the suppliers very low because they are a major part of their suppliers company. They buy so much from them that they would never want to lose the business that they have with Starbucks. Starbucks keeps their business going so their power remains low. 5. Intensity of Competitive Rivalry- High i. There is no cost at all to the consumer for switching to a different coffeehouse to purchase their coffee in the morning. This shows that competitive rivalry in the industry is high. ii. Starbucks has done very well to keep a slight competitive advantage over other coffeehouses. They have continued to change and grow their product line and they also have the most premium coffee that there is. Also they have kept a very friendly staff across the board so that helps people want to come to that atmosphere opposed to somewhere else. D. Opportunities in the industry. 1. Starbucks could extend the supplier network. They do not grow their own coffee beans therefore, they have to buy them from different suppliers. There are many factors that go into getting good beans from different countries. The need to extend the supplier network to ensure the supplies necessary for

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