Evolution Of Starbucks Coffee

I decided to choose a brand that is recognizable and beloved by most of the world. One with very little negative connotations surrounding it in common conversation. After researching the company extensively, and with very little difficulty given its popularity, I’ve learned just what makes Starbucks Coffee such a powerhouse of a company. They have outshined all other companies related to the coffee industry in terms of profit, storefronts, and worldwide reach. All of that growth and development from a company that sprouted only 46 years ago in Seattle Washington. Starbucks began as a coffee distribution company in 1971, but it was not until 1982 that the Current CEO Howard Shultz came into the picture. Shortly after, Howard traveled abroad

From the beginning Shultz was taking steps to make his concept diverse. He moved the company toward selling its brand of coffee in store fronts in 1987 under the name II Giornale, which he would later change to Starbucks Corporation. At this time there were seventeen store fronts (“Company Timeline”). The company expanded its reach even further in 1991, when the first airport store front opened (“Company Timeline”). I really can relate to the fact that airports as well as travel pit stops in general are a great place for a caffeine boost, so I admire this move. A couple of years later the first drive-through Starbucks opened, followed closely by the release of bottled Frappacinos in grocery stores. Instant coffee machines are in some cases compatible with small cups of coffee grounds that give the consumer a one cup at a time advantage to their morning brew. This was another opportunity for Starbucks to find a place on supermarket shelves (“Company

The first thing that I noticed, was that Dunkin’ Donuts is over all a smaller company than Starbucks is. With that in mind, all comparisons are in terms of proportion. Additionally, all number figures are valued in 000’s. In 2014 Starbuck’s gross profit was $9,589,000. The growth of that gross profit has been of a pretty consistent value each year since, reaching $11,375,200 in 2015, $12,804,800 in 2016, and $13,348,600 in 2017 (“SBUX Income”). The balance between total revenue and cost of revenue have dually increased in a marginally consistent manner. I picture this being the goal for a large corporation like Starbucks. Dunkin’ Donuts ended the year 2013 with a gross profit of $582,465, and while 2014’s gross profit of $612,185 and 2015’s gross profit of $679,445 were similarly consistent, the next jump to 2016 was only a gross profit of $693,872 (“DNKN Income”). I don’t mean to scrutinize Dunkin’ Donuts for this, but in terms of consistency I do think Starbucks has the lead here. One thing Dunkin’ Donuts did do well however, was keeping the cost of revenue low in comparison to the growth of total revenue. Finally, I took a look at the balance sheets for each company those years and noticed that Starbuck’s assets rose comparably to their liabilities