Core Issues Of Starbucks

Seattle based, Starbucks Corporation is the leading coffeehouse chain in the world. The company has its operations in more than 44 countries. The main products offered by Starbucks various kinds of drinks, snacks, coffee beans. The company also operates in the field of marketing of music, books (The Company, 2008).

Starbucks is dominant coffee brand in North America, which also is well-known worldwide. Established in 1971 as coffee shop oriented to a niche of coffee purists, in late 1980’s it turned to be a constantly growing chain of stores that sold whole-beans and premium-priced coffee to mostly affluent, well-educated customers. In years 1992-2002 company was showing at least 5% annual growth. And by 2002 Starbucks was serving already 20M customers in 5886 stores (both operated and licensed) around the globe, had $3.3 billion net revenues and was opening 3 new stores a day in average.

Since they have become a 50% equity investor in a joint venture with Pepsi cola they now manufacture brands such as Frappuccino® beverages, Starbucks DoubleShot®, and Seattle’s Best Coffee®. Starbucks also have been really successful with their own brands such as Tazo® Tea, Seattle’s Best Coffee®, and their flagship brand Starbucks VIA®Ready Brew.

These products, as well as the company’s Ready-to-Drink product line (bottled coffee and tea available in sizes and locations similar to what one would find Gatorade or Naked Juice), has allowed it to move beyond the simplistic produce-and-sell business model found at its stores and into the retail market. Having focused on the retail market for the better part of the last decade while still maintaining its store operations (now with more than 20,000 stores worldwide), Starbucks has seen its market share increase exponentially while its competitors, such as Dunkin Donuts, have seen far less success. (As an example, Starbucks has a market cap of $84 billion while Dunkin Donuts has a market cap of less than $5

Starbucks has strong leaders on the management team. Managers have to be able to delegate responsibility to his or her employees in order to keep the company running successfully and keeping Starbucks on the top of the coffee store market. The managers have learned how to bring out the best in each employee and get them to work to the best of his or her ability. Doing this has led to Starbucks employees being happy and doing the best job for themselves and the company.

Partner satisfaction: Starbucks firmly believes that satisfying their employees in-turn satisfies the customers. They adopted a positive working environment to facilitate this.

Advertising for Starbucks remains mainly by word of mouth, generally before they did not used to invest too much in advertising, however it has been increased slightly with the past of the years but still being a little bit low, but still being low comparing with other global brands for example they just spent 1.4% of the revenue in advertising while Coca-Cola is more than 10 percent.

Seeing a Starbucks sign reminds a person of the tantalizing flavors that are brewed from the store that sells millions of people their first cup of coffee every morning. Upon walking into the store, it is inviting and welcoming. The staff is friendly and helpful and the crowd is eager to enjoy that bittersweet java on the taste buds. When an order is made, the staff prepares each individual cup of coffee fresh, and exactly to the customer’s preference. Starbucks Corporation is the leading retailer, roaster and brand of specialty coffee in the world. Starbucks Chairman Howard Schultz has built a booming empire, with 13,500

Starbucks purchases and roasts high-quality whole bean coffees and sells them along with fresh, rich-brewed, Italian style espresso beverages, a variety of pastries and confections, and coffee-related accessories and equipment. In addition to sales through our company-operated retail stores, Starbucks sells whole bean coffees through a specialty sales group and supermarkets. Additionally, Starbucks produces and sells bottled Frappuccino® coffee drink and a line of premium ice creams through its joint venture partnerships and offers a line of innovative premium teas produced by its wholly owned subsidiary, Tazo Tea Company. The Company's objective is to establish

Starbucks is a corporation well known for roasting, marketing and retailing of crafted quality beverage that is based on coffee. Starbucks started its operations in Seattle’s Pike place market with Howard Schultz helping in its marketing and retailing efforts. The company is extremely successful and focused on the development of positive company-customer relationships. Starbucks uses company-customer relationships and a customer-centered approach as its key business strategy. The customer-centered approach allows the company to maintain its current position in the market.

P.3-4  Starbucks also sold coffee products through non-company-operated retail channels; these so called "Specialty Operations" accounted for 15% of net revenues. About 27% of these revenues came from North American food-service accounts, that is, sales of whole-bean and ground coffees to hotels, airlines, restaurants, and the like. Another 18% carne from domestic retail store licenses that, in North America, were only granted when there was no other way to achieve access to desirable retail space (e.g., in airports). The remaining 55% of specialty revenues carne from a variety of sources, including international licensed stores, grocery stores and warehouse clubs (Kraft Foods handled marketing and distribution for Starbucks in this channel), and online and mail-order sales. Starbucks also had a joint venture with Pepsi-Cola to distribute bottled Frappucino beverages in North America, as well as a partnership with Dreyer 's Grand Ice Cream to develop and distribute a line of premium ice creams.

In recent years, Starbucks has battled with its competitors for a share of a global market

In general the coffeehouse industry in the United States was experiencing an increase in coffee consumption per capita due to the “Starbucks effect”. At this time Starbucks was operating approximately 20,000 stores in the United States and was living a fast expansion strategy worldwide.

The goods that are produced by this company are coffees, teas, expresso beverages, equipment, drinkware, and foods. Starbucks also produce goods that would fall under a miscellaneous group, such as: bottled drinks, Frappuccino blended beverages, smoothies, and packaged goods (MarketLine 23-25). Their line of business that’s most profitable are their beverages. During Starbucks 2015 fiscal year, 79% of their revenue was attained from their company-operated stores (United States Securities and Exchange Commission). Starbucks beverages include; a combination of more than 30 coffee-blends and single-origin premium coffees. In addition,

But, the chairman of the board, Schultz, thought that even when 25,000 to 30,000 international outlets are opened up till 2013, the organization will still be at its start up since the use of coffee takes the 2nd position of the most-consumed drinks all over the world, whereas water takes the 1st position. Social Education (2011) views Starbucks’ as the organization that lies not in their measurable qualities but in their ability in order to make everybody feel much better and improve their lifestyles.