Starbucks Case Study

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“The Boston Consulting Group (BCG) matrix is enhancing a multidivisional firm’s efforts to formulate strategies” and are including Question Marks, Star, Cash Cows and Dogs Starbucks is applying this matrix to identify the each stores strategic position. In division Question Marks, shows low relatives market position but high growth industry. Firms cash needs are high and cash generation is low. This division decides to strengthen on pursuing an intensive strategy. Division Stars is the best long-run opportunities for growth and profitability. This stage is maintaining or strengthening their dominant positions. Next in are Cash Cows with control and manage for high relative market share position but compete in a low growth industry.…show more content…
Furthermore, Starbucks also provide express food to reduce time to be spent and increase healthy products which is high demand in the time being. Do research & development to sell products in every supermarket with low price and same quality. Threats Starbucks need to change marketing strategy by reducing price to compete with the competitors. Create new products with low price and good quality for customers and sell at supermarkets too. There is intense competition in the coffee market amongst established coffee shops that are fighting to get customers. There are local coffee shops offering specials to lure potential customers in. Restaurants are opening earlier and closing later to accommodate customers on the go. With the 85% North American customers taking their coffee to go, convenience is a major factor There is a great deal of risk of entry by potential competitors due to the low start up costs. McDonalds is able to add specialty coffee to their existing services to tap into the specialty coffee market. There is potential of $125,000 per year in revenue to be made by each store if they are able to successfully enter the specialty coffee market. Water is a substitute which is healthy for us and it is free. The option to buy bottled water is also inexpensive compared to coffee. With the focus on healthier living, water is the ultimate choice. There is more bargaining power

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