Case Study : Starbucks Coffee Company

This report is on the Starbucks coffee shop company. Starbucks was founded around 45 years ago in 1971. Its first store was located at 2000 Western Avenue in Seattle, Washington until 1976, when it moved its operations to Pike Place Market, Elliott Bay, Seattle, Washington, U.S. where they began selling espresso coffee in 1986. The three founders Jerry Baldwin, Zev Siegl and Gordon Bowker were former students of the University of San Francisco. Their plan was to sell high quality coffee beans and roasting equipment. They did not know at the onset the company would become so successful.

The company many sales drink, Food and Nutrition. Drink comprises of the finest coffee from best beans procured all around the world and various other products. They also serve food which is good from the customer’s nutrition point of view. They also serve various beverages cold drink, brewed coffee etc. They not only serve food with nutritional value but also salads, sandwiches etc.

A cup of coffee in the morning seems like such a simple pleasure and certainly not one that a person would generally associate with ethical issues like social responsibility, or global corporate citizenry. However, a cup of coffee is actually a serious ethical issue. Coffee is one of the commodities that are still grown in some areas in conditions that are similar to slavery or sharecropping. Moreover, coffee shops, like many fast food service establishments, employ people at the entry level into the job market, increasing the possibility of worker exploitation. Fortunately, as the world has become more globalized, consumers have become increasingly aware of the global implications of their local actions. Therefore, some companies have taken significant steps to act in a globally responsible manner, aware that being solely or primarily motivated by profit is not necessarily a sustainable business model. Starbucks was one of the first companies to embrace corporate responsibility as one of its primary corporate goals. It extended this corporate responsibility to a global environment when it committed to purchasing coffee in a more ethical manner. In many ways, Starbucks has embraced Harvard University's Corporate Social Responsibility Initiative's definition of corporate social responsibility, in that Starbucks "goes beyond philanthropy and compliance and addresses how companies manage their economic, social, and

Starbucks Corporation purchases and roasts high-quality coffees, along with beverages and fresh food items, throughout all company-operated stores. The consolidated financial statements reflect the financial position and operating results of Starbucks Corporation. Ratio Analysis was used to analyze the performance of Starbucks using the financial ratios of liquidity, solvency, and profitability. Calculations and amounts were provided in the excel spreadsheet labeled “Financial Ratios”. All data provided were conducted from the balance sheet and income statement accounts over the fiscal years 2015 and 2014. Starbucks Corporations ' fiscal years’ end on the Sunday closest to September 30 (sec.gov).

Many Starbucks business practices concern activists and international advocacy groups. Even the consumers have expressed issues. So, the company should take these into account to continue holding consumers’

Starbuck Corporation establish in 1971, its located in America Seattle, WA. Starbuck are a premium roaster, marketer and retailer that specialty in coffee all around the world. Till year of 2015, Starbucks has over 182000 employees. There have 19767 operated &licensed companies over 62 countries. Their product includes a mix of handcrafted and roasted premium coffee, tea. a variety of fresh baked item and other beverages. Beside selling their variety product of coffee and tea, starbuck also license their trademark trough different channel to expand their business, for example licensed stores, grocery and national foodservice accounts. Starbuck also cooperate with other brands and mix their brand name within the

1. The story of Starbucks Corp. begun in Seattle (Washington, USA) in 1971 when Howard Schultz took over a single store; later in 1985, Schultz partnered with Jerry Baldwin to start today’s famous multinational Starbucks Corp. and its 17.000 retail stores in all countries of the world.

Three Seattle academics and entrepreneurs, English teacher Jerry Baldwin, history teacher Zev Siegel, and writer Gordon Bowker, started the Starbucks Corporation in 1997. Their primary product was the selling of whole bean coffee in one Seattle store. By early 1980's, this business had grown into four stores selling the coffee beans, a roasting facility, and a wholesale business for local restaurants. "There store did not offer fresh-brewed coffee sold by the cup, but tasting samples were sometimes available" (Thompson, Jr. et al, 2005). In 1982, Howard Schultz left his job as vice president and general manager of a Swedish company and assumed his new responsibilities as head of marketing and overseeing Starbucks

Starbucks is one of the leading coffee retailers in the world; according to their company profile they are operating nearly 18,000 retail stores in 60 countries. They serve millions of customers daily; our mission: to inspire and nurture the human spirit – one person, one cup and one neighborhood at a time. (STARBUCKS COFFEE COMPANY, 2012) Starbucks has become much more than just a place to get coffee, it has become a brand.

Starbucks acted ethically after their financial scare by upgrading their coffee equipment for their customers. Also, Starbucks added a new menu item to offer customers a more dynamic selection in their stores. Starbucks began to think more along the lines of a small mom and pop coffee shop to fit in with the local stores. To continue, Starbucks plays a significant ethical role within the community. Starbucks donates too many charitable causes within the community. Also, Starbucks allows their customers to provide feedback about their local coffee shop. Due to this ethical behavior, Starbucks gains new customers by offering them a place to relax and give their input on their

Starbucks went public in 1993 and has done extremely well in turning an everyday beverage into a premium product. The green and white mermaid logo is widely recognized; the brand is defined by not only its products, but also by attitude. Business Week’s most recent survey (2002) of the top global brands reported Starbucks as one of the fastest growing brands. It is all about the Starbucks experience, the atmosphere and the place that is a refuge for most people to get away from everyday stresses. The average customer visits a Starbucks eighteen times in a month and about 10 percent of all customers visit twice a day. They have created an affinity

In recent occurrence for Starbucks, the company business has gained exceptional growth. Howard Schultz who is the chairman and CEO of Starbucks stated that “Starbucks Q3 fiscal 2015 stands as among the strongest and most remarkable quarters in our over 23 years as a public company.” (Starbucks Corporation 2015, 1) Starbucks “net revenue $4.9 billion in Q3 FY15, which is an increase of 18% over Q3 FY14.” (Starbucks Corporation 2015, 1) Part of the increase revenue for the company was due to global expansion in the China/Asia Pacific area. Within a year time frame, Japan opened “1,592 new stores.” The impact sales from Japan help “increase the company income about 22% to $938.6 million in Q3 FY15.” (Starbucks Corporation 2015, 1) Safe to

“Starbucks is the leading specialty coffee retailer in the nation, with over 5,000 locations in 22 international markets. Starbucks positions their products on a relatively simple plane. They focus on quality and experience, rather than price. A comparison of specialty drinks with its competitors reveals very minor differences. Starbucks’ image is one of the key elements to their success. The company has realized that people don’t only come for the coffee; they come for the atmosphere. People socialize, read, study, or just enjoy the music while drinking their coffee.” (Kembell, Hawks, Kembell, Perry, & Olsen, 2002)

Even with the “No. 1 Best Coffee” Award from Zagat’s Survey of National Chain Restaurants as well as numerous other awards and recognition under their belt, Starbucks remains vulnerable to the ever-changing, ever-demanding needs of their customers (Starbucks Company Recognition). In order to succeed in the service industry, companies must provide impeccable customer service in addition to rewarding their customers through programs and promotional strategies. Currently, Starbucks has reward programs and promotional strategies in place, but they have failed to construct them in a way that fairly and appropriately benefits their customers. In addition, Starbucks’ reward programs are generally unknown by most people

“The Boston Consulting Group (BCG) matrix is enhancing a multidivisional firm’s efforts to formulate strategies” and are including Question Marks, Star, Cash Cows and Dogs Starbucks is applying this matrix to identify the each stores strategic position.