Introduction Starbucks built an empire for the modern persons’ need for a quick coffee. This case study is created on the basis of Starbucks Corporation. This case will include an analysis of differentiation and an expansion strategy that Starbucks has implemented; following it up with Porters Five Force Model and a SWOT analysis to analyze the internal and external environment of Starbucks Corporation. Background The history of Starbucks, all started out when it was introduced in 1971 by three academics, Jerry Baldwin, Zev Siegel, and Gordon Bowker, and by 1980, Starbucks grew to four stores in Seattle. In 1981, Starbucks’ expertise of dark-roasted coffee caught the attention of Howard Schultz who was an American business man, and since
The company operates farmer support centers staffed with agronomists and sustainability experts who work with coffee farming communities to promote best practices in coffee production designed to improve both coffee quality and yields. Starbucks Operations Starbucks operates in 75 countries and there are two store formats: 1. Company-operated stores. They enable the management to observe shifts in consumer tastes and preferences and collect information about market tendencies in a direct manner. By the end of fiscal year 2016 they accounted for about 51% of total numbers of stores.
Starbucks Corporation is an American coffee company and also coffeehouse chain. The first Starbucks was founded in Seattle, Washington in 1971 by 3 partners, which are Jerry Baldwin, Zev Siegl, and Gordon Bowker. They looked for the inspiration from Alfred Peet to set up a coffee store for selling high-quality coffee and equipment. Initially, Starbucks were a roaster and tradesman of whole bean, coffee, tea and spices with a single store in Seattle’s Poke Place Market. After around 10 year, the director of retail operation which is Howard Schultz realised that they should be selling drinks rather than just bean and machines.
\ 5. Market Structure According to Pitek (2009:4) they have possessed the capacity to make a standard for their espresso and in which they require their client base to be misrepresented costs for a measure of their different mixes. With use of the Starbucks logo, quality, and different trademarks, they separate their espressos their rivals. Starbucks prides itself on being totally not the same as some other café and its rivals, which is a motivation behind why Starbucks has turned out to be so fruitful. The organization's procedure to concentrate on their centre abilities to separate themselves has made Starbucks into an espresso powerhouse.
Moreover, this technology could keep track of its customers’ consumption patterns and buying behaviors. By storing and handling these kinds of data, Starbucks could analyse the data and to facilitate its product innovation in order to keep their existing customers and attract more new customers. It also helps employees to know the updated data of the demand of different kind of coffee to predict their sales revenues. It provides interaction with suppliers so that Starbucks could share the data with their suppliers to have a better forecast of the demand of coffee beans. 2.
Starbucks has strong market position and brand awareness make the company gain a significant competitive advantage in further expanding the international market and contribute to the growth of domestic and foreign markets. Strategy is a balanced problem, sometimes difficult (Allard, 2004). Ultimately, the strategy is about making a choice, the company will succeed if chose a unique strategic location which is different from the position of each competitor (Markides, 2000). One of the key strategies pursued by Starbucks since its inception was product differentiation, providing differentiated products such as premium product mix, location, coffee beverage reputation and the highest customer service, transformed into a high-value brand for competition
The organization I work for, Starbucks is highly diversified. In my opinion, Starbucks successfully employs each of the seven diversity components: “authentic leadership commitment, clear organizational communication, inclusive recruitment practices, long-term retention strategies, incorporating diversity into main work of the organization, diversity management metrics, and expansive external relationships” (CanÌas, Sondak 2014). With that being said, Starbucks could improve by incorporating diversity into main work of the organization. One way Starbucks proves their commitment to diversity is authentic by holding a diverse board of directors. Of the seven board members, three are women and one of these women is of an African descent.
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). Risk management in Starbucks organization is very important and the company takes them very seriously. The company cannot afford mistakes or failures, so they hire the best of the best to managers and employees. The company has a very tough hiring process, because they want to be sure that the person they are hiring is a perfect fit for its position.
Introduction Starbucks is a giant coffee company and coffeehouse chain. They provide specialty coffee. Starbucks opened its first store in Seattle. Today, they have more than 21,000 coffee stores across the world spread in US, EMEA, China, India Japan etc. Starbucks stores offer a wide range of choices of coffee, tea beverages and other related products.