Michael Porters Analysis Of Starbucks Essay

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Michael Porter, a Harvard Professor introduces his ideology of the Five Forces model that shapes the competition in the industry. Each force is interrelated and therefore leads into the other to show the elements directly involved in the further success or ultimate success of the firm.      Starbucks Coffee Co. throughout its existence since 1971, with its great management team, innovative style of thinking and strong will to succeed in compliance with its mission and vision statements has and continues to overcome its barriers by recognizing such strategic planning as those included in Porter’s five forces model. The model includes such components as Barriers to Entry, Supplier and Buyer Power, Threat of…show more content…
The aspiring new firm may have to conform to the economic scales already set for them which may mean high cost and high pricing or may have to result to a cost disadvantage. These disadvantages may effect production, marketing, research and development and many other elements directly related in the determined success of ones company. Product differentiation which ties in brand identification that can and will result in new firms having to spend a lot of capital earnings to break the customer loyalty that has already been established. Brand identification is a result of costly advertising and customer service that a companies plays out to gain the market share needed to bring in a profit. Capital is a must for all startup companies for investment and survival purposes. Capital can create barriers for new entrants because it may not exist for them to make up the lost expenses used to contend to the many other barriers that were previously introduced. Starbucks because it was always Starbucks took a major risk starting up which costs a lot of capital which of course was made back through much profit and undoubted success. Yes, Starbucks did have to overcome the may barriers listed and it was costly and time consuming but it did pay off in the long run because of the management team and the leadership and eagerness of Schultz. Another barrier may include the access a company has to

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