Report for the Promotional Plan of Hot and Chocolate Tea/Coffee of Costa Coffee

External Environmental Analysis of Starbucks and the Coffee Industry Harold Brown Strategic Management March 3, 2011

Costa Rica now provided raw material for Starbucks which accounted for about 15 percent of the total coffee beans Starbucks needed every year. Costa Rica as one of the raw material suppliers plays an important role in global value chain. Coffee has played a pivotal role in the development of Costa Rica. It has shaped social, cultural and political institutions and is still one of country’s major agricultural exports. (Anywhere, 2016) The global value chain in this coffee industry can be described that Starbucks, the centre in this coffee global value chain, purchasing raw materials (coffee beans) from coffee farms in Costa Rica, reprocessing and reproducing in retail shops, selling the finished products (various kinds of coffee) to customers in the world.

Many people continue to drink coffee on a daily basis. Per capita coffee consumption is expected to increase at an annual rate of 0.9% in the next five years to 2020. The industry revenue is anticipated to grow at an annual rate of 2.3% to $40.1 billion within the same period. The total revenue

The coffee value chain involves four main phases: cultivation, processing, roasting, and consumption. Each phase in the process has environmental, social, economic, and governance outcomes, affecting the future sustainability of extracting the coffee bean. The photo below illustrates the

Costa have a dominate stakeholders,because is a big company and have thousands of employees, they can choose the prices for the coffees,they have milions of pounds profits.

This marketing plan is an attempt to measure the market that Costa Coffee is in and determine where growth can occur over the next three years. This plan looks at how the company is performing internally, and tries to determine issues that may occur externally that could have a negative effect on the company.

As for other coffee consumption facts, brewing coffee at home declined from 2006-2011 with 75% of total coffee sales made “away from home” (High Beam Business, 2012). Furthermore, an interesting study revealed the growth in this target market: “another new and large growing target market within the coffee industry is college-age students and post graduate individuals residing in urban areas. These two segments account for the largest portion of coffee drinkers” (Scribd, 2012, Marketing

Statistics show that over half of the American population consumes coffee on a daily basis. You may drink coffee hot, cold, mixed, or even in a frappuccino. Individuals are able to make coffee at home, or buy it on the go. Coffee provides people with caffeine, which ultimately gives energy for hardworking people all around the world. The main focus for this paper will cover the following topics, with coffee as the basis: causes for shifts in supply and demand, how coffee supply and demand influence price, quantity,

A review of the estimated growth in retail sales of coffee over the next four years indicates that while sales of non-specialty coffee products are expected to decline, sales of ground specialty coffee products and whole bean coffee should rise. Further, sales of ready-to-drink products are projected to rise almost 50%.

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 demand for coffee shops is born from the increased number of individuals seeking coffee brewed outside of the home. This creates a larger market for coffee shops. An increased amount of people are starting their mornings off by purchasing breakfast and a cup of coffee away from home (Tuttle 2014), more people are enjoying gourmet coffee (NCA National Coffee Drinking Trends 2015 Infographic), and younger generations are demanding more coffee and coffee drinks from coffee shops (Tuttle 2014, S&D Coffee and Tea inc. 2014, Statista 2015). Coffee shops must compete with at home coffee, work place coffee, and teas for the caffeinated beverage markets (LN 2015). Demand for coffee within different markets varies, and provides competition for coffee shops. Single cup coffee makers, increasingly qualitative instant coffees, and gourmet beans are all sources of competition that could satisfy the demand for coffee. However, coffee shops are becoming more ingrained in social

Having worked in independent coffee establishments I recognised how the coffee culture is becoming increasingly popular and trendy, coffee has become a worldwide commodity and the demand for good artisan coffee is increasing year on year.

Starbucks inbound logistics comprises of the firm’s quality control specialist in selecting top-quality Arabia coffee beans from suppliers that maintain a sustainable approach. Starbucks supports ethical sourcing by operating “responsible purchasing practices, farmer support…” (Starbucks, 2016) also corporate social responsibility (CSR). Additionally, their tactic is utilizing the “Coffee and Farmer Equity (C.A.F.E.) Practices” (Starbucks, 2016), wherein this approach is the first set of sustainability benchmarks in the coffee industry and is certified by third-party logistics professionals. The C.A.F.E. Practices has assisted Starbucks in relation to generating a “long-term supply of high-quality coffee” (Starbucks, 2016) and influencing the lives of the farmers and their communities. Furthermore, Starbucks utilizes economies of scales in their inbound logistics activities by developing outstanding supply chain procedures by using C.A.F.E. and also includes collaborating internationally with managers discussing strategic alliances through suppliers for their products. Starbucks have recently

The drink was no longer just a utilitarian morning stimulant and has a satellite pastime very European style: the windows from floor to ceiling, special atmosphere, soft music, dozens of varieties of coffee. However, besides all this, coffee is a business not only successful, but also has today a huge potential for development.

Since Coffee businesses such as Starbucks and Dunkin Donuts are rapidly increasing as well as its recognition worldwide this can be a serious constraint when it comes to identifying my product features which can lead my business to a perfect competitive environment which implies low profit. To lower the chances of ending up in this type competitive environment, our coffee beans are going to be exported from Brazil, Vietnam, India, and Dominican Republic even though the Dominican Republic is not included on one of the top coffee producing countries; I will like to open up opportunities for Dominican coffee brands to supply coffee beans to my industry. For customer satisfaction our coffee is going to be naturally produced and serve; by naturally serve I mean is not going to include any milk or other substances that takes away the true natural and pure flavor of coffee even though both Starbucks and Dunking Donuts have this type of option in their menu, it will be going to address different consumer needs. Besides the fact that nowadays coffee is really predominant, my service is going to provide not only satisfaction to my customers, but also it will inspire them to achieve their goals and ambitions.