CASE ANALYSIS AND PROBLEM SOLVING:
STARBUCKS
Course: Business Policy Ethics and Strategy (F-410)
Case Summary
Starbucks Corporation is an international coffee company and coffeehouse chain based in Seattle, Washington. In October 2006, Starbucks was the largest global roaster and retailer of coffee with more than 12,000 retail stores in 60 countries, some 3,000 of which are to be found in forty countries outside the United States. Looking forward, the company expects 50% of all new store opening to be outside the United States. In 2006, Starbucks closed a decade of astounding financial performance with increasing sales from $697 million to 7.8 billion, net profit from $36 million to 40 million and ROIC was 25.5%.
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➢ Ability to Provide Superior Customer Services and Best-Known Brands: Starbucks were able to provide superior customer services in selling its various premium products through highly trained and motivated employees. This superior customer services had resulted in the creation of the best-known brand name and customer loyalty which generated enormous volume of repeat business for the company.
Case Discussion Question 2:
Answer:-
Starbuck took strategy to sell coffee in a unique way of delivering better service. With their strategy they have built some resources such as unique design of their stores, premier location, superior brand name, experience and training of the employees and basic formula of the product and they have also developed some capabilities such as good organizational rules and procedures, better hiring system, training program, service oriented values and progressive compensation policy. The resources coupled with the capabilities developed by the strategy of the company have given Starbucks to develop some distinctive competencies of unique service delivering process, superior management of employees, preference to owing stores and ability to provide superior customer services. These distinctive competencies are giving Starbucks competitive advantage. As a result, with these competitive advantages, they have
The Starbucks Corporation is an international coffee company that was founded in Seattle, Washington (Starbucks.com). With 19,435 stores in 58 countries, it is the largest coffeehouse chain company in the world; Starbucks sells a variety of hot and cold drinks. These include espresso
Starbucks is rated as the number one World’s leading coffee distributor. Customers satisfactions are always be in the center of their business and the company works consistently to maintain it as customer look forward to a unique experience when visiting one of Starbuck stores. With over 12,000 stores worldwide, Starbucks has always aimed at achieving and maintaining competition in the industry. Starbucks success reside in many factors : the company is admire and respected worldwide,employees are recognized and respected for what they contribute to the success of the company. Open communication
Starbucks has created a competitive advantage with their product quality by setting themselves apart from their competitors. “The Company has stayed with the upper-scale of the coffee market, competing on comfort rather than convenience, which is the case with its closest competitors, McDonald’s and Dunkin Donuts” (Mourdoukoutas, Panos). Consumers believe they are receiving a better product and experience when they purchase from a Starbucks as opposed to another large food service company that may sell coffee.
Starbucks employs the product, promotion, place and price method of marketing. They place great emphasis on their products and have established themselves
Starbucks Corporation is an American global coffee company and coffeehouse chain based in Seattle, Washington. Starbucks is the largest coffeehouse company in the world, with 20,366 stores in 61 countries, including 13,123 in the United States, 1,299 in Canada, 977 in Japan, 793 in the United Kingdom, 732 in China, 473 in South Korea, 363 in Mexico, 282 in Taiwan, 204 in the Philippines, and 164 in Thailand.
Starbucks Corporation is an American global coffee company and Italian-styled coffeehouse chain, based in Seattle, Washington. It is the world’s largest coffeehouse chain, and is considered one of the world’s best-liked and best-known consumer brands- with 19,972 stores in 60 countries. Business analysts agree that Starbucks is a widely respected company because of its commitment to social responsibility. Starbucks has earned this reputation through its actions in all phases of its business and live out this commitment through both its mission statement and values. The Starbucks website states that, “Our mission: to inspire and nurture the human spirit – one person, one cup and one neighborhood at a time”. Starbucks even has a
Starbucks Corporation is a globalized coffee company operating successfully since 1931.It had its headquarters in Washington and have branches in more than 63 countries. Starbucks is known for its premium quality and high standard coffee. Starbucks coffee is one of the most
Starbucks Corporation (Starbucks) is a specialty coffee retailer of hot and cold beverages, coffee-related accessories, complementary food items, teas, and other non-food related products. Starbucks has retail stores in 39 countries and about 146,000 employees. The company operates primarily in the United States (U.S.) with headquarters in Seattle, Washington (Starbucks, 2007).
Starbucks has always taken exceptional care in keeping its brand value. In fact, Starbucks prides itself in its brand, particularly the power it has to keep its customer base strong. Before analyzing this loyal customer base it is best to consider the particular characteristics of the brand that has led to Starbucks having such devoted patrons.
First, Starbucks has effectively applied the product differentiation strategy. To achieve it, the company has specialized in different product mixes, aligned its business locations to a specific ambiance that suits the context, and varied the customer experience, thus resulting in a higher customer service satisfaction. Further, Coskun, Basligil, and Baracli (2008) note that Starbucks prides in having their customers enjoy a premium service. Therefore, the company’s signature strategy has worked well thus far, as competitors find it difficult to imitate. Second, the enterprise has coordinated its acquisition and portfolio strategy, thus consolidating the market. As discussed in the background chapter, Starbucks has a portfolio network of eight brands under its stable. Third, Starbucks’ international expansion strategy has worked well, with a presence in 70 countries (Starbucks, 2017). These factors, coupled with its financial capability, offer Starbucks an edge over its
Also, very little paid advertising was needed. Word-of-mouth and visible locations were the best marketing ploys. Starbucks employees or “partners” were paid well, tended to stay, and got promoted from within the company. Howard Schultz’s philosophy was that satisfied employees lead to satisfied customers. Partners receive both “hard skills” (the specific operational talents) and the “soft skills” (customer satisfaction focus). To accomplish Starbucks’ objective of becoming the “most recognized and respected brand in the world” they relied on aggressive, diversified expansion to take advantage of the specialty coffee popularity, introduced new products, and added store value cards (SVC’s) and Wi-Fi hotspots for its customers.
* Start serving fresh fruits and berries as well as salads (maybe by the cup/ Fruit salads)
12,000 employees will lose their jobs…Starbucks will offer relocation packages to many employees, severances to others.
Starbucks is still only supplying less than 5 percent of the coffee market. With this low of a number there is still much more growth that can take place within the industry. This number allows for many more stores to be added to their list of future prospects. Weber states that competitiveness is related to company effectiveness, which is determined by whether the company satisfies the needs of stakeholders (groups affected by business practices). Important stakeholders include stockholders, who want a return on their investment; customers, who want a high-quality product or service; and employees, who desire interesting work and reasonable compensation for their services. The community, which wants the company to contribute to activities and projects and minimize pollution of the environment, is also an important stakeholder. Companies that do not meet stakeholders’ needs are unlikely to have a competitive advantage over other firms in their industry. The economy is still moving ahead strong and the possibility of their becoming a recession are starting to become a bit more possible.
By choosing Starbucks, customers can customize their drinks to perfection by selecting one of its 30 different options of premier coffee blends. Following the order process, customers can enjoy the great atmosphere by listening to music or perhaps enjoy taking part in friendly conversations with pleasant workers and patrons. Simply put, Starbucks thrives on a connected customer experience that differentiates them from the rest of the industry. Also, retail storefronts. In the U.S., Starbucks kindly takes advantages of the fact Americans tend to have morning rituals. As a result, they have the opportunity not only to serve loyal customers, but also essentially to become part of their lives (Krikorian, 2014).