Putting the coffee into Europe
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INTERNATIONAL BUSINESS: a case study
“Putting the coffee into Europe”
BBB4M
30/11/2023
-
1.What are the primary factors contributing to the success of Starbucks?
Starbucks has built a foreign investment strategy from the very first steps :
From an unremarkable local coffee brand and retailer. Thanks to a trip to Italy, they were inspired by espresso and quickly bought it again. Thanks to this determination, Starbucks has taken the next steps to test overseas "whether the Starbucks chain can operate in the US market or not?".
Building a global retail brand and international development model :
Starbucks invaded mainland Europe, finding the differences and risks of selling coffee versus fashion. Have effective cooperation with businesses and individuals with similar goals, culture, hedonistic leadership, belief in people and knowing how to manage people and customers
Practical application – BHAG :
BHAG
an interesting term, referring to a goal that is big and audacious, clear and long-term, compelling enough to inspire every employee to take action, pull everyone out of stagnation and energize them. motivate them to take action.
Build a realistic brand, emphasizing the multicultural aspect of each country. For example, Starbucks chose Switzerland as its first port of call because of its belief in environmental and community values. Approach the joint venture model and establish a company to build a strategy for their country. Switzerland is not in the Union, nor is it in the 5 big countries and in terms of population, but they have strong opportunities, and have strong partners. Proving that Starbucks is looking for the right opportunity, not wanting to rely on a strong country
Good leader and excellent customer care : Mckeon asserted that the leader is very important in running a business chain. If the company doesn't keep up with the market, it's easy to fall behind. Starbuck always improves their leaders, that's a fact. The leader not only operates but is also the "face" of a business, associated with that company's reputation and statement to the whole world.
Market growth depends on consumer demand and brand accessibility. Starkbuck listens and responds to customer needs absolutely, recognizing cultural differences and
racial diversity of countries around the world. They have their own strict policies for their service, especially no smoking and no drinking. To explain this problem, starbucks focuses very much on the quality of their coffee beans, so they don't want any scent to affect the inherent smell of coffee. Therefore, they always ensure and commit that the cups of coffee delivered to customers are the highest quality cups of coffee.
2. Analyze the impact of currency exchange rates on Starbuck’s financial performance
Revenue and profit
Starbucks has a revenue of 2.6 billion and a profit of 110 million based on available statistics. If the country where Starbuck invests has an economic recession, Starbucks' entire revenue system will be significantly reduced, affected by domestic and foreign interest rates as well as price differences. The value of currencies between countries also affects exchange rates.
Investment and expansion
Starbucks has more than 23,000 shops in 64 countries, this is a huge number for a coffee and retail chain. Starbuck's reputation is indisputable and that causes significant competition between a country's traditional stores and the expansion of the market to find more store chains from other countries. A country's GDP can change that country's
economy, and investing in a country with an unstable GDP is also a difficult step for Starbuck. Acquiring or investing in a developed country may be more expensive and more difficult to pay back for Starbuck because their premises and economy are already strong enough and do not need to receive from a foreign market.
Capital resource
In 2020, Starbucks achieved annual revenue of about $26.5 billion and profits of about
$3.6 billion. This is truly a record business result, further helping to highlight Starbucks' operating efficiency. But investing so much causes a risky investment risk, investing in the wrong way can cause Starbuck's economic downturn in an instant. Affecting joint venture chains and weakening revenue sources, investment will hit Starbuck's exchange rate strongly. Or is it that Starbuck can no longer find new and
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