History and Progress of the Internationalization of Starbucks in China

Starbuck 's has become a staple of American culture and for the most part, if you are in your 20 's, you have grown up with it and this has become what you expect coffee to be. Who can blame you, it is everywhere, so "wake up and smell the coffee"! I plan to tell you about the strategies that this giant uses, that have taken it from humble beginnings to a worldwide phenomenon. I also intend to explain how Starbucks is taking China by storm, mainly because marketer / entrepreneur Howard Schultz 's vision and mission statement is shared by everyone in the company!An excerpt from the London Financial Times published in February 2006 states the following in regards to Starbucks entering the Chinese market; "Mr Schultz said the company was

The three most critical challenges Starbucks faced in China were political restrictions, socio- cultural, economic and financial challenges. China is highly bureaucratic country with difficult processes of getting permissions and sanctions to start and run business. The biggest challenges for Starbucks were the old tradition of tea drinking in China. At the beginning Starbucks managers didn’t how to accustom Chinese to drinking coffee; to acquaint employees and Chinese executives with coffee drinking experience Starbucks provided different training programs for them in which they learned more about coffee and Starbucks’ culture.

As Starbucks' strategic vision evolved over the years, so did its strategy. Starbucks current strategy in comparison to its original competitive strategy are: to continue the focus on growth; to establish a leadership with company owned stores in key markets such as USA, Japan, Australia, and UK; to pre-emptively enter and aggressively grow in all targeted markets; to leverage the brand into new product categories and channels; to continue operations improvement; to growth through innovation; to develop and maintain leadership talent; and to maintain their values, culture, and guiding principles. The key elements of Starbucks current strategy is to expand Starbucks globally, and to further develop its internet business. The strategy has changed over time as the business has grown exceptionally well in North America, and now they want to take that success over sea.

And finally, on February 1st, Starbucks Coffee Company opened its first store in Vietnam at the New World Hotel in downtown Ho Chi Minh City. The company has studied Vietnamese market since 1991 and made VERY, VERY careful steps when entering this market. The only partner licensed to operate Starbucks stores in Vietnam is Coffee Concepts Vietnam, a subsidiary of Hong Kong Maxim’s Group. The signing with Coffee Concepts Vietnam will maximize the growth potential of Starbucks in Vietnam as the partner has experience in managing 130 stores in Hong Kong and China. Starbucks’ strategy is to bring unique coffee experience to customers at its stores. Besides, Starbucks will boost the localization of stores in its business strategy in Vietnam to make Starbucks stores the third destination for local people, following their home and office. “Starbucks provides much more than just the best cup of coffee, we will offer a place where people come together, connect with family and friends and celebrate the local Vietnamese coffee culture and heritage”, said Jinlong Wang, President of Starbucks Asia Pacific. Now let us begin our SWOT analysis. One of my team members, Lan Huong, is going to show you some strengths of Starbucks Coffee Company.

The final project is going to be about the market entry of Starbucks into China. This project will focus on gauging the success of the company's market entry strategy thus far. Starbucks has announced in a press release that it believes China will be its #2 market by 2014, and the company has been one of the most successful American companies in that market (Starbucks, 2012). The company entered the Chinese market in 1999 with a store in Beijing. This followed the acquisition of greater knowledge about Chinese business culture through outlets in Taiwan. The company initially used a licensing agreement to enter the Chinese market (Starbucks, 2010).

Many multinational corporations in the coffee industry have succeeded tremendously such as Starbucks. Each of these corporations has strategies that helped them continue to expand to nations of different cultures, ethnicities, governmental practices, and locations.

All the stores of The Coffee Bean & Tea Leaf were located at high traffic, high visibility locations in each market. The market entry strategies use by the coffee shop in managing their foreign franchisees when expanding into Asia including master franchising and company owned-stores. A master franchise is a person or entity that provides services to franchisees in a specified territory, typically a major market, geographical region or even one or more countries. The marketing approach is essential to gain a competitive advantage in the foreign market. The construct included market entry, site location, and market positioning. The reason

Starbucks is undoubtedly an international brand. The history of coffee traces back to Ethiopia, Africa, India, Arabia, and Europe, and has been traded abroad since the 11th century. Understanding the demand and widespread market for coffee, Starbucks has triumphantly capitalized both the domestic market, and the varied international markets as well. Possessing about 6,500 retail sites worldwide, Starbucks’ net is spread across thirty countries and has been found as one of the most recognized brands all over the globe in equality to McDonalds and Toyota. This organization’s ability to build an international brand has been unprecedented- particularly since it represents a specialty

• Looks at big picture: It helps Starbucks has consistent brand image around the world.

Starbucks strategy at the beginning was based upon creating a symbolic-expressive value trough a social meaning concept of offering the American community meeting places; this positioned its original products and made associations to identify consumers with self-expression providing personal, social and sociocultural meaning.

Starbucks used many tactics to reduce its distance from foreign markets. Firstly, Starbucks conducted extensive research in each country. They used focus groups, and quantitative analysis, to evaluate local cultural sensitivities and preferences. But it also used specific local adaptations. For

This case assignment discusses the history of Starbuck’s accomplishments as they entered the American coffee culture heritage. In 1983, The chairman and CEO Howard Schultz traveled to Italy and had a dream to carry the Italy coffeehouse ritual back to the United States. Schultz was focused on creating an environment meeting company that makes good coffee but also be a social experiment. Starbucks today opened more than 19,000 stores functioning in 62 countries. Starbucks has numerous rewards that globalization has offered and they have significantly benefited from it, while in the coffee industry. Starbucks has a wide-range in marketing strategies to benefit the customers. During the different obstacles that Starbucks has encountered, they must stay reliable in quality and uphold to adjust to different customer values.

Starbucks is one of the largest coffee shop chains in the world. In 2005 it was the leading coffeehouse retailer in the world with operations in 34 countries outside the US, counting 10.241 coffeehouses. Starbucks began its international expansion with Japan in 1995. We think Starbucks is a global company. Throughout the answer we will use Starbucks’ value chain activities to explain why Starbucks can be considered a global company.

Factors in the global environment provide both opportunities and strengths for Starbucks. Opportunities such as increased revenues, further expansions, and achieving their goal of becoming the most respected brand worldwide. Starbucks also faced threats. These threats include dealing with growing antiglobalization overseas and their huge risk of less return on each overseas store, this deriving from overseas operations being run by local partners instead of Starbucks

Starbucks’ retail entry model in the United States does not have the same strategy as their international model. In the states Starbucks holds great control as a corporation, but in international territory, country partnerships, cultural, government laws and politics play a very important role in Starbucks’ entry strategy. Starbucks has set it sights globally since the coffee market has come close to saturation in the U.S. which will give them the opportunity to continue to expand without fierce competition. Starbucks has looked to countries like India and other emerging markets with great growth potential to set down new roots. Starbucks recognizes India as a great choice to expand business internationally but also recognizes the complexity in the same market after several attempts to enter without success.