Starbucks: The World's Number One Popular Coffee Retailer

Risk of entry into the specialty coffee is very minimal in the case of Starbucks within the United States. Nationally Starbucks competes against brands like Caribou Coffee, Dunkin Donuts, and McDonald’s in the retail coffee and snacks store industry. Within the domestic market

Climate change. “The company is now preparing for the possibility of a serious threat to global supplies…if conditions continue as they are – is a potentially significant risk to our supply chain, which is the Arabica coffee bean.” (Goldenberg, 2011)

The problem was that Starbucks was too ambitious in trying to target all customers, but failed to pay attention to the needs of loyal customers who nourished the brand. According to “Rediscovering of Marketing Segmentation” (Yankelovich & Meer, 2006), a company

The price of coffee is subject to significant volatility. Supply and price can be affected by multiple factors in the producing countries, including weather, natural disasters, crop disease, general increase in farm inputs and costs of production, inventory levels and political and economic conditions.

First of all I will explain the external environment of Starbucks using PESTEL analysis, Porter's five forces analysis and competitor analysis. Next will be an analysis of Starbucks' strategic capabilities. These will be determined using a resource audit, a value system analysis, the identification of possible core

Porter 's fourth industry force is bargaining power of suppliers. Coffee is the world 's second largest traded commodity (Bruce). South and Central America produce the majority of coffee traded in the world. Starbucks depends upon both outside brokers and direct contact with exporters for the supply of green coffee (Bruce). The supply of coffee is affected by weather conditions, and the health of coffee trees. According to the article "Coffee Industry to Adopt New Pricing Plans," the major players in the coffee industry have seen profits decline because of over-crowding of the market (Brains Trust). An over-crowded market will give the coffee suppliers bargaining power. According to

Starbucks Incorporated is a Washington based international business who had a total revenue of over $22 million in 2017. Starbucks’ employees near 254,000 employees within 2016. This company is known for their coffees, especially around the holiday seasons, all over the world. Majority of their profits come from the American market while they are trying to expand into the eastern world. However, their customer experience and support allows consumers in other markets to want to be a part of the westernized experience. Starbucks has the opportunities to grow within their grocery store sales and to expand their brand, both in more products and in more stores. Starbucks is also affected by local coffee shop competitions and economic conditions constantly changing which hurt their profits. Regardless, Starbucks proves that they have a strong business model that allows them to stay as one of the international beverage leaders.

In April of 1984, Starbucks tested the espresso bar at its sixth store located at the Fourth and Spring in downtown Seattle (Schultz & Yang, 1997). Although the espresso bar was crammed into a small corner at the back of the store, it turned out to be a success since customers just keep coming in and out of the store just to purchase a cup of coffee (Schultz & Yang, 1997).It was the first time America was served with café latte (Schultz & Yang, 1997).

Starbucks not only provides its customers with refreshing and delicious beverages but it is also a brand that has a specific atmosphere that it is known and loved for. Therefore, Starbucks’ reputation itself is enough to intimidate any new business before they can even step into the market and face their worthy competitor.

The threat of new entrant is low for Starbucks. This is because the beverage industry, especially coffee industry is highly saturated and also needs substantial financial resources to invest in buildings and properties in order to enter the market.

Starbucks Coffee Company is an amazing chain companies that has been considered to be successful in the entire business. They have preserved its image while offering high-end facilities and service to clients at a little high price than several other coffee shops.If rhetorical view is concerned, Starbucks utilizes the visual elements and language power to appeal customers along with profit and a raised selling image of their brand.

First Starbucks was a Private Company, from its inception in 1971, to it 's initial public offering in 1992. We believe that there since the beginning, Starbucks strategy has been one of growth. They have demonstrated all dimensions of a growth strategy: Internationalization in expanding into new countries and the global market. It has shown concentration in being creative and relying on it 's core competency of making high quality coffee and coffee equipment to develop new products and markets. Horizontal Integration has been evident in the many strategic acquisitions, partnerships, and joint ventures. Vertical Integration has been another key success factor as Starbucks

The ambitious growth strategy was adopted by Starbucks in 2002 which was a time when the coffee drinking culture in the US was gaining popularity. The people drinking specialty coffee was identified to be a profitable segment to focus attention on. It was also identified that majority of people drank coffee not at home but outside, in offices, restaurants and coffee shops. There

Starbucks primary objective is to establish the company as the most recognized and respected brand in the world (Starbucks Website). Starbucks is a gourmet coffee shop so they must increase their name brand so as to justify their gourmet status. In order to maintain its success Starbucks must implement an effective implementation plan. A company may have a great product, but if it fails to identify a specific market, or to use a proper marketing plan, it will not be able to successfully reach the consumers. Over the years Starbucks has been successfully able to take simple activity carried out at home to the pinnacle of commercial success. By expertly executing their marketing strategy Starbucks has taking coffee service to an art form.

"[A]s [their] coffee becomes more widely available, the inherent contradictions between increasing sales and preserving brand integrity have intensified." Starbucks decides on the right strategic partner through an extensive screening