Chapter 8.3, Problem 3RQ

Summary Introduction

To explain: The advantages that company S has over local coffee businesses in the global market and the way through which it has disadvantages to compete against existing coffee houses in other countries.

Case summary: In the given case, S is the coffee powerhouse that grows continuously by facing challenges of looms in market saturation in the country U. Competitors also attacked intending to take shares from company S. MD and MC proven their popularity among consumers of country U with cost-conscious effort. Therefore, to gain its competitive edge, company S planned its stores by partnering with company UE for the delivery service. In the plan, the company decided to use technology that will make employees free to spend time with customers and enhance the service. The company started to use big data to identify customer needs and preferences. After country U, country C is the second biggest market for company S where it planned to launch a new delivery program by changing the store into a virtual store on the platform of e-commerce. Then, the company’s partnership with its rival N expands its reach by adding the restaurant lines in the company stores. But L’s business model appealed to consumers of country C to use small store format, fast delivery, low price, and high technology which created problems for company S in country C. The price-sensitive consumers did not pay interest in the product of company S. In the rural areas of country C, company S can face plenty of challenges because consumers are price sensitive but in the urban areas or major cities, the company can be benefitted because large people from the globe reside in these cities.