STARBUCKS STRATEGIC MANAGEMENT ANALYSIS INTRODUCTION Starbucks Corporation is an American multinational corporation founded in 1971 in Seattle, Washington. Starbucks is the leading marketer, retailer and roaster of specialty coffee around the world. The company has more than 182,000 employees in more than 19,767 company licensed and operated stores that are found in 62 countries around the world. Starbucks product mix includes roasted premium coffee, handcrafted high-quality coffees, a variety of fresh food items, tea, and other beverages. Starbucks also sells a variety of tea and coffee products under their licensed trademarks through different channels such as food service, grocery, and stores accounts. Starbucks also has another product …show more content…
The strategic management analysis should focus on the organization’s sole purpose of managing courses of actions that prevail in cost effective and the informed execution of strategies to enhance smooth running of the business. The activities that are under strategic management involve utilization of resources to facilitate the performance of Starbucks in its external environment. The activities and process in strategic management entails of the developing the organization’s vision, mission, objectives, policies and plans that are in the form of programs and projects; all this are designed to achieve the business objectives, allocate resources efficiently …show more content…
The growth should be supported by the growth of the economy and by increasing the confidence of the customers through expansion of menus that are offered within the industry. Starbucks is the major player and has a market share of 36.8 percent, followed by Dunkin Brands with 24.7 percent and other companies included McDonalds, Tim Horton’s, Costa Coffee among others (Box, 2011). PORTER’S FIVE FORCES ANALYSIS OF COFFEE INDUSTRY THREAT OF NEW ENTRANTS The threat of entry of new entrants into the industry is moderate as the barrier to entry is not discouraging to new companies or competitors to enter the market. The coffee and snacks industry is moderately high with a monopolistic competition state; some companies like Starbucks are dominating the market. The new companies entering the industry do not find problems; an initial investment is not important as they can lease stores to INTRODUCTION TO STRATEGIC MANAGEMENT AND5 start the
• The author used the current situation of the coffee industry to define Tim Hortons' position in the coffee industry. • The author used the current situation of Starbucks to compare with Tim Hortons’ operation. •
Running head: pantry inc. case analysis 1 pantry inc. case analysis 20 Pantry Inc. Case Analysis Sekia Grimes GEB5787 Table of Contents Introduction 3 Industry Analysis 4 General Environment 4 Sociocultural………………………………………………………………………………4 Political/Legal…………………………………………………………………………… .4 Economic…………………………………………………………………………………5 Porter’s Five Forces ……………………………………………………………………………... 5 Rivalry……………………………………………………………………………………5 Threat of New Entrants…………………………………………………………………..
Political • Growing demand and supply shortage has increased world coffee prices. • Favorable advantage to accessing raw material through supplier relationships. • Fair-trade practices include its Coffee and Farmers Equity (C.A.F.E.) program among other fair trade policies and agreements. • Starbucks adheres to local, national and international government laws and policies and tightly control labour practices, avoiding scrutiny and negative imagery from being a large corporation. Economic • High industry sensitivity to the macroeconomic factors affecting disposable income, a main industry driver.
In this era of globalization, the supermarket industry is one of the common investment sectors. It is also forming retail common categories of food products such as fresh and meats, poultry and seafood, fresh fruits and vegetables, canned and frozen foods as well as various dairy products. Investment in this industry can be profitable if succeed but bear in mind that risk still exists if monitoring process is not carried out. Therefore, Professor Michael E. Porter from Harvard Business School has introduced a tool for purposes of analysis potential industry which is the most profitable and potential. Porter stated that five forces are deciding an industry either beneficial at future or it will become a case study and commerce practice (Porter, M.E., 2008).
For instance, you could take reasonable favorable position of a solid position or enhance a feeble one, and abstain from making incorrectly strides in future. • Threat of New Entry is not intense, because JJ has its hold in Market from10 years and they re-established them after 2009 with new technology and strategies. JJ itself planning to open 600 new stores which makes new entrants to stop coming in
Businesses have been playing a crucial role in people’s lives. No matter what they go or what the occupations they are; people are drawn to get involved in businesses. However, behind the scenes of the business thriving, the environment is deteriorated each day. Many development schemes are come up with the plan related with the depletion of the environment (Shah, 2002). Because of people and environmental damages, attentions were drawn to corporations for ensuring their sustainabilities.
Starbucks sells high quality food and brands for affordable prices. Recently, the company launched a wine collection in addition to the coffee. Now, customers can enjoy a coffee in the morning and a wine after work. This strategy will bring more revenue to the company and will put the Starbucks on the map with other great small shops. The brand has also positioned itself best coffee brand in the market by providing attractive store design, unique environment, elegant taste and high quality coffee beans (Kotler & Keller, 2009).
At this time the rights to manufacture, market, and distribute Starbucks ice cream was given to Unilever. In 1998 Kraft Foods began marketing and distributing whole bean and ground coffee to supermarkets in the US. Tazo Tea was acquired by Starbucks in 1999 and in 2005 they acquired Ethos Water. A partnership with Jim Beam Brands created Starbucks Coffee Liqueur in 2004 and Starbucks Cream Liqueur in 2005. In order to offer healthier options they began offering skinny lattes, banana walnut bread, fruit cups, yogurt parfaits, a farmer’s salad, and smoothies in 2008.
IMPACTS OF ECONOMIC FACTORS ON STARBUCKS The ongoing global economic recession is the prime external economic driver for Starbucks. As I already mentioned, this factor dented the profitability of Starbucks. This has convinced buyers to shift to cheaper alternatives. As they did not quit buying coffee, Starbucks should seek an opportunity here. The company has to deal with rising labor and operational costs.
Starbucks was founded in 1971. They have 18.850 stores in more than 40 countries which makes them the first coffee specialty retailer in the world. They operate most of their stores having only 50 franchises (as of 2017) as to keep strict control over quality. The success of Starbucks is based on their unique value proposition. They offer customer the finest coffee produced by themselves, with strong commitment on creating a global social impact, served in stores that promote a welcoming and warmth sphere where everyone can feel “like home”.
Starbucks specifically staffs star skills to enable employees to maintain and enhance their self-esteem, learn to listen to other people’s ideas and seek assistance when appropriate, so that staff can work together and have the confidence to communicate with customers. Relationship between strategy, policy and procedure Strategy, policy and procedure are integral to Starbucks, and the strategy is to help Starbucks make long-term plans. The policy is to plan to accomplish the goal. The procedure is the process of action. Starbucks is about to achieve its goals in performance management, but also to meet the company’s long-term performance.
Ethical issue in Starbucks Starbucks, an American coffeehouse chain based in Seattle, Washington, is the world largest coffee retailer chain in the world having more than 21,000 stores in 65 countries (Starbucks website, n.d.). In United States, Starbucks owned 12,973 stores (Starbucks Company Statistics, 2014), which is more than 73% of the market shares of the United States coffeehouse industry. Hence, Starbucks possesses monopoly power in the specialty coffee market. Enjoying monopoly position, Starbucks plan to completely dominate the market by eliminating competition. Starbucks engages in a range of anti-competitive activities.
1.0 Introduction to Strategic Management Strategic management practices the formation; achievement and reaching the major objectives executed by the management of the company, by considering the capital and a task of the internal and external environments in which the company wishes to compete. 1.1 Introduction to Singapore Airlines Singapore Airlines (SIA) is established in year 1972 with remarkable performance among its competitors in the industry throughout its 35-year-long history till date (Heracleous & Wirtz, 2009). According to Singapore Airlines (2014), SIA is one of the youngest aircraft fleets worldwide to destinations crossing a network of more six continents, with its iconic Singapore Girl providing excellent standard of service to customers. Throughout the years of operations, SIA has an impressive ever-growing list of industry 's leading innovations such as offering free headsets along with a choice of meals and drinks in Economy Class in the 1970s, followed by introducing satellite based in-flight telephones in year 1991, involving an ample panel of renowned chefs, the International Culinary Panel, to provide lush in-flight meals in year 1998, developing audio and video on demand (AVOD) capabilities on KrisWorld in year 2001, and lastly flying the airbus of A380 from Singapore to Sydney on 25 October 2007 (Singapore Airlines, 2014).
In this section, we use the Porter’s 5 forces model to evaluate the attraction of the industry when focus on the following 5 forces, Calm coffee faces the impact of the 5 forces, as outlined in Porter’s model. These five forces have different intensity or advantage based on Calm coffee position, as follows: This part of the 5 Forces analysis shows that competition is one of the most important of Calm Coffee need to concern. The businesses have many competitors, which have different sizes, specialties and strategies. For example, Calm faces the competitive force of McDonald’s and Starbucks, as well as other specialty coffeehouse. The strong force of competition is also because of the low switching cost, which means that the customers can easy
The new company must know about the company that they want to compete. For the new company that want to joint in this industry must have big capital to build the cinemas with the latest of system technology of cinemas that can make the customers can choose the new company compare the others companies. They also get high of threats that can make the company cannot run stable in this industry. In this case, the customers don’t worried about the services of the MBO cinemas, because they always make the best for the customers that can make the customers feel great while watch their favourite movies.