Starbucks is an American global coffee company and coffeehouse chain that was founded by Howard Schultz in Seattle, Washington in 1971. It is currently the largest coffeehouse company in the world ahead of UK rival Costa Coffee with 21,536 stores in 63 countries (Appendix Figure 1), (Yanofsky, 2014). The company rapidly expanded between 1987 and 2007 where Starbucks opened on average two new stores every day (Bspcn.com, 2007). The first coffeehouse to open outside the United States or Canada was in Tokyo in 1996 and overseas stores now comprise nearly one third of Starbuck’s stores. Reasons for their success is the continuous disciplined expansion of their global store base, adding stores in both existing, developed markets and in newer,…show more content… Starbucks achieves this through a vast range of high quality products that positions them as a premium coffee producer and distinguishes itself from its competitors.
The success of Starbucks has stemmed from their Global Responsibility strategy, commitments related to ethically sourcing high-quality coffee and a positive contribution to the communities they do business in and being an employer of choice (Starbucks Coffee Company, 2015).
This success can also be seen from a financial aspect, Starbuck’s total net revenues increased 11% to $16.4 billion in fiscal 2014 compared to $14.9 billion in fiscal 2013. Moreover, these results also show continued strength in their ability to successfully implement new growth initiatives leading to strong revenue growth and a surge in operating income and operating margin expansion (Starbucks Fiscal Annual Report, 2014).
Ethical activities and corporate social responsibility (CSR) impact the success of Starbucks financial performance. A modern concept of CSR has evolved since the 1950s, formalized in the 1960s and proliferated in the 1970s (Carroll, 1999). CSR can be defined as ‘a concept whereby companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders on a