Revision- Starbucks case study

Starbucks

Starbucks is an Amercian global coffee company. There are about 20,891 stores in 62 countries. Starbucks established in 1971 as a Seattle coffee beans roaster and retailer by three partners.

From this graph, it describes the number of starbucks shops  have a significant increase within 30 years. Especially, from the 2001 to 2007, the date rise from 4000 stores to 17000 stores.

Firstly, in this case study, I will do the SWOT anlysis,  the SWOT is a tool help people to identify the strengths, weaknesses, opportunities and threats. The SWOT is a basic,straight forward model to analysis a company what they need to do an what they can not do.  It  show the company's potential opportunities and threats.

Strengths. W. O. T





The starbucks shop's locations are often in the marked places, such as the city centre, large shopping mall, high-end residential. It can attract amout of customers.The starbucks is a global coffee brand. It has almost 19000 cafes in 62 countries. The high quality products and services are also streagths.The starbucks have good relations with the suppliers. In addition, the organization has strong ethical values and ethical mission statement as follow," starbucks is committed to a role of environment leadershio in all facts of our business". Because of  these facts, the consumer loyalty is very high.

From this chart, we can know from 2009 to 2013, the revenue and EPS are have an significantly rise, the date of EPS increased quicker than the Revenue, the starbucks is a public limited company, the invester and the shareholders earned lots of money from the starbucks.

In 2011, the starbucks profit margins were hit seriously by the global financial crisis, however, the company covered quickly, it increased 12.7% in 2012. The starbucks famous brand name and the high customers loyalty help the company recovered quikly.

In 2013, the starbucks opened aout 1200 new shops, many in the United States and China.

S. Weakness. O.T

The starbucks faces strong competitions. The McDonald's, Burger King, wendy's, Subway and the Taco Bell 's market share in the US in 2005 are larger than the starbucks. The McDonal's market share is 7.7%, the Burger King's market share is 2.4%, the Wendy's and the Subway's market share are 2.3% and 2.2%. The Taco Bell and the starbucks's market share are 1.7% and 1.6%.

There are few new products development and creativity. Their innovation may flater over time.

Global coffee beans price influence the starbucks's profit.

High product prices in some counties also make the starbuck's maret share lower than other company.

The McDonald's premium coffee price was lower than the starbucks.

Some negative publicity (Health Problems,; Tax evasions; poor treatment of suppliers)

The starbucks does not grow its own coffee beans, it must depand on the coffee suppliers.

S.W.Opportunities.T

1. Develop new products and new services.
2. Starbucks has may opportunities to expand its global operations. Develop new market such as India, China and any other Pacific Rin.
3. Co-branding with other companies to develop other companies food and drinks (offer wine and beer)
4. Technoligical advances( new coffee machines etc)
5. The starbucks should form more of such partnerships and offer  coffee to some big supermarket.
6. To extend supplier network.

S.W.O.Threats

• Different cultural and Political issue in foreign countries.
• Consumer trends towards more healthy lifestyles. They think people should away from coffeeine
• Coffee price volatilty in developing countires.
• In the US mareket, the coffee market is saturation.
• Due to the political, economic and weather condition, the supplier line may disruption, it will increase the cost of the firm.
• Trademark infrigement. Some company illegal use the brand of starbucks.

Ways to global and growth strategies

• Horizontal integration
• Starbucks combine with its competitor.eg It introduced a drink of coffee with Pepsi through joint ventures. In this way, they can decrease the loss of competition. This product was accepted by the customers and creating a win-win effect.

• Vertical integration
• Starbucks is trying to control its input. Direct control of suppliers and their roasted coffee plants. The safety of their first-class coffee beans to meet growing demand and grower and exporter, check te agricultural environment and crop yield, and look for variety and source: will conform to the starbucks strict standards of quality and taste.