Financial Feasibility Of Starbucks Corp. Expansion In Italy.

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Financial Feasibility of Starbucks Corp
Expansion in Italy
Patten University

Financial Feasibility of Starbucks Corp
Expansion in Italy This report will focus on evaluating the financial stability of Starbucks Corporation by assessing the feasibility of an expansion of operations into Italy and will include a forecast of future financial outcomes as a result of the expansion.

Introduction

Company Description Starbucks began in 1971 as a single store in Seattle’s historic Pike Place Market. From just a narrow storefront, Starbucks offered some of the world’s finest fresh-roasted whole bean coffees. The name, inspired by Moby Dick, evoked the romance of the high seas and the seafaring tradition
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Starbucks is no stranger to international markets and has multiple overseas subsidiaries in almost every country in which they operate. In 1985, Starbucks started its expansion into different cities in the USA and Canada, opening in Chicago and Vancouver, B.C. In 1995, Starbucks decided to internationalize its business outside of North America and expanded into Japan by creating a joint venture with SAZABY Inc. Today, Starbucks is the largest coffee shop company in the world holding 42.4% of the U.S. market share (Tucci, 2017) and generating more than 10 times the revenue of its closest global competitor, Costa Coffee, as of 2015 (President, 2015).

Annual Reports

Financial Statements
This section shows copies of the company’s financial statements for the past five years.
STARBUCKS CORP INCOME STATEMENT
Fiscal year ends in September. USD in millions except per share data. 2012-09 2013-09 2014-09 2015-09 2016-09
Revenue 13300 14892 16448 19163 21316
Cost of Revenue 5813 6382 6859 7788 8511
Gross profit 7486 8510 9589 11375 12805
Operating expenses
Sales, General and administrative 4719 5224 5630 6608 7425
Other operating expenses 980 3611 878 1166 1208
Total operating expenses 5700 8835 6508 7774 8633
Operating income 1787 -325 3081 3601 4172
Interest Expense 33 28 64 70 81
Other income (expense) 305 124 143 372 108
Income before

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