Strategy Analysis : Starbucks Corporation

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The purpose of this essay is to prepare a strategy formulation analysis required by the company. The company selected is Starbucks Corporation, commonly known as Starbucks, when they first started in Seattle, Washington in 1971, founded by Jerry Baldwin, Zev Siegl, and Gordon Bowker; and became an American multinational company which started from scratch (Garza, n.d.). It was then incorporated on November 4, 1985, and is a roaster, marketer, and retailer of coffee. Starbucks offers a range of exceptional products include coffee, handcrafted beverages, merchandise, and fresh food. The company 's mission is "to inspire and nurture the human spirit - one person, one cup, and one neighborhood at a time" (Starbucks, 2012). Today, Starbucks is…show more content…
Therefore, it is acknowledged that strategic choices are not only bounded by industry conditions and firm-specific resources, but also by formal and informal constraints which would then lead to existing and potential risks and influences in the host area, in this case faced by Starbucks entering Myanmar. The institutional factors that may pose a threat are as below. 2.1.1 POLITICAL RISK The political risk is the risk that the host country fails to provide a stable legal and regulatory environment, therefore significantly harms the investment (Bonell, Carroll, Kelp, & Ye, 2013). Based on the Political Risk Index by risk consulting firm Maplecroft, Myanmar is ranked the 5th in the world and is rated as extreme risk (Marsh, 2013). One of the main prevalent issues is due to corruption which poses a difficult operating environment for foreign investors. It is stated that even in 2012, corruption watchdog Transparency International ranked Myanmar as one of the world 's most corrupt nations (Mahtani, 2013). Other issues include communal violence and a government bureaucracy that is ranked bottom by Transparency International put early investors at substantial risk (Wettach, 2013). 2.1.2 TRADE BARRIER Myanmar do impose reasonably high import tariffs, however as Myanmar is a member of ASEAN, it is required to eliminate nearly
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