Case Study : Starbucks ' Biggest Strength

Since Starbucks entered the coffee retail business, the company has made many trade-off business decisions. The first major trade-off was made when Howard Schultz wanted to acquire present day Starbucks from three entrepreneurs Baldwin, Siegel and Bowker. Therefore, Schultz prior to the acquisition made the trade-off to open his own coffee bar in 1986 instead of staying at Starbucks as the manager of retail sales and marketing. A bold feat, Schultz was able to replicate success and was offered to buy Starbucks for $4 million. At the time of the acquisition, many investors, including the former Starbucks owners, would not expect that the American consumer would pay a premium for coffee products. Schultz, after calculating the opportunity cost, was convinced that Starbucks would become a large coffee chain not only in the United States but internationally too. Reflecting this approach, Schultz’s trade-off worked. Starbucks, according to our book has revenue exceeding $13 billion and nearly 200,000 employees. The company has also expanded to 40 countries with 17,000 stores (Hill et al., 2015).

starbucks Corp., an international coffee and coffeehouse chain based in Seattle, Washington, has expanded rapidly since its opening in 1971. These outrageous success was due to its well-developed strategy vision which lay out the company's strategic course in developing and strengthening its business. Starbucks is a global corporation that sells authentic coffee in 30 countries, reporting revenues of nearly $5.1 billion in 2006. The main goal of Starbucks is to embrace diversity by applying the highest standards of excellence. Starbucks strives to perfect the relationship with the working class by making the service as fast as possible because they believe that every customer has their own personal rate. One

1. In the beginning, how was Starbucks different from other coffee options for coffee drinkers in the United States? What activities and assets did Starbucks leverage to differentiate itself from competitors?

Several key success factors exist for Starbucks, a leader in the coffee industry. They include

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In this paper, I will talk about Starbucks Company. I will define the influence of the vision, and mission of the company and primary stakeholders along with their overall success. An examination will be conducted to categorize five forces of struggle and their effect on the corporation. I will carry out a SWOT analysis to determine the opportunities, threats, strengths, and weaknesses. Founded on the SWOT analysis, a technique of opportunities and advantages will be exploited while threats and weaknesses will be diminished. Several types and levels of techniques will be talked over to operate the profitability and competitiveness. I will outline a plan of communication to make approaches known to all investors. Two corporate authorities will be designated to assess the efficiency of the regulating managers. I will also assess the effectiveness of management within the Company and come up with sanctions for upgrading.

In 1971 Starbucks started as a small coffee shop that specialized in selling whole arabica beans in Seattle’s Pike Place market. After being inspired by Milan’s coffee culture - especially the role it espresso bars played in the Italians’ everyday social lives - Starbucks opened an espresso bar in the corner of their shop. Their ideal was to create a ‘third place’ - besides home and work - where people could relax and enjoy a good cup of coffee (Moon & Quelch, 2006). Over two decades the company enlarged and served over 20 million unique customers in over 5,000 stores around the world. Their brand strategy could best be described as ‘live coffee’, which meant creating an ‘experience’ around the consumption of coffee that fitted into people 's everyday lives (Moon & Quelch, 2006). Three components were fundamental for their branding strategy. First of all, the coffee itself which should represent the highest-quality coffee in the world, derived from Africa, Central and South America, and the Asia-Pacific regions (Moon & Quelch, 2006). Secondly, the atmosphere should be inviting and make customers feel comfortable. The ambiance in stores should make customers want to stay (Moon & Quelch, 2006). Thirdly, service - customer intimacy - is a key factor within their brand strategy, which aims to create an experience for the customers, and aims at building customer loyalty (Moon & Quelch, 2006). The employees - called ‘partners’ - are

.1. Introduction1.1 Distinctive Growth Tale of Starbucks 1.2 Strategic Deportment1.3 Starbuck as a Global Corporation 1.4 Impact on the international economy

I've chosen the Starbucks Corporation on which to do my case assignment for the session. I first became interested in Starbucks while working on a paper for a previous marketing class. I became intrigued at the entrepreneurial spirit that such a large corporation had managed to maintain throughout its massive expansion. Starbucks corporation, unlike many of its now-defunct rivals, has done an outstanding job since its meager beginnings in 1970 with the execution of its strategic process; resulting in it currently owning 40% of the specialty coffee market and boosting annual sales exceeding $7 billion according to Burt Helm. Historic successes and recent turmoil within the company, including a near 40% decline in 2007 in profits (Sullivan

business model may seem, there is plenty of hard work invested and financial risks taken to grow

Cognition gives the companies information on how consumers respond to different marketing stimuli they face for the products used. It has to do with customer’s thinking and how do they behave toward a particular product. To be more specific and also reading the book “cognition refers to the mental structures and processes involved in thinking, understanding, and interpreting stimuli and events.” (Peter & Olson, pg. 21)

The context change in form that Starbucks found itself competing with smaller chains that resembled its former pre-expansion model with competitors focusing in creating symbolic-expressive value and fast food restaurants that had started to offer specialty coffee with more aggressive advertisement at a lower cost. The competitive context changed for Starbucks because it’s focus in mass distribution channels and its retail footprint strategy stated its product within a standard performance product value; this affected the value perception of the product.

Starbucks dates back from 1971 and is based in Seattle, Washington. The company was founded by Gordon Bowker, Jerry Baldwin and Zev Siegl and it

Starbuck’s strategy focused on three components; high-quality coffee, intimate service, and ambient atmosphere. Starbucks worked closely with growers in Africa, South and Central America, and Asia-Pacific regions to insure the quality of its product. Starbucks called all employees' "partners" and worked hard to train them with the skills necessary to best serve the customer. The atmosphere at Starbucks was crafted after the European-style espresso bar. The company goal was to create ambience through the Starbucks "experience" and by making the area comfortable, yet upscale.

You provided an excellent response to this week DQ. I agree that businesses large and small need to find balance in their organizational structuring that align with overall mission and goal in such a way to maximize profit and survivability. The organization structuring should be flexible and agile enough to respond quickly to changes in the competitive business environment, especially now in the global market place. The textbook, Management Leading & Collaborating in a Competitive World, provide us a good starting point into understand organization strategy. It is interesting to note that today large organizations are moving to a structure model where they need to partition themselves in smaller unit so they can respond quickly to customer