The Coffee Drink Industry

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In this essay we are going to define the factors that help in the industry's success and the aspects influencing the order for coffee in the Middle East area. There are many reasons behind the coffee drink industry growth in the world's current form. The first reason is the fundamental shift in the preferences and tastes of consumers, where the modern coffee drink industry was able to create among the population all over the world the need to have a coffee in a different way, in a different climate, and a different mixture, which led to the industry spread as we see now. Another reason leading the coffee industry to gain considerable profits is age. As an increasing youth people is a major factor that leads to the coffee industry's…show more content…
With the emergence of intercontinental coffee drink companies, the new product of coffee drink shifted to the list of regular goods, and with the growth of average incomes all over the world, it has been able to hundreds of millions of its inhabitants to pay for the drink of a famous trademark, at the time that the population abandoned the traditional coffee drink, such as " Turkish coffee cup ", due to its transformation into an inferior…show more content…
Nearly all monopolistically competitive companies are marginally ineffective since assembly average total cost is not at the lowest level. In this case, in the long run, the marginal cost is cleanly lower than the cost of the product. This means that the cost of the Starbucks drink is marked up above the cost of production. The charge of manufacturing for Starbucks might not be the most cost-effective, but it is below the cost charged for their gastronomes. This may possibly also give explanation of why the cost of Starbucks coffee is very expensive; their production costs are high and that costs are imposed to the clients to raise their profits and reduce operating costs. Starbucks pricing is seen to be above the average. The environment between the competitors differs from a fast-food chain where the aim is to obtain quick service, whereas the coffee shops atmosphere is growing slowly and stress-free. New market rivals can raise the competition for market share, reducing prices, and the effectiveness of an industry. Some recent competitors can respond against newcomers to prevent them from intervening in the industry in the beginning. There are several major barriers/obstacles to entry that make it difficult for newcomers. Economies of scale indicate the drop in unit costs as extreme output volume

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