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Summary of organization’s historical development
Starbucks Coffee Company was founded in 1971 in Seattle’s Pike Place Market (Starbucks Company Profile). The original name of the company was Starbucks Coffee, Tea and Spices, later changed to Starbucks Coffee Company. Starbucks was named after the first mate in Herman Melville’s Moby Dick is the world’s leading retailer, roaster and brand of specialty coffee with coffeehouses in North America, Europe, Middle East, Latin America and the Pacific Rim. Worldwide, approximately 35 million customers visit a Starbucks coffeehouse each week (Starbucks Comapy Profile). The first founders of Starbucks were founded by English teacher Jerry Baldwin, history teacher Zev Siegel, and writer Gordon Bowker. The three were inspired by Alfred Peet, whom they knew personally, to open their first store in Pike Place Market. The store originally focused more on the sale of beans and equipment than on selling prepared coffee. After that first year, they bought their beans direct from farmers before roasting them. The company remained small and regional for years and there was not much of a specialty coffee market nationwide. The original Starbucks location was at 2000 Western Avenue from 1971-1976. That store then moved to 1912 Pike Place where it is still open. During their first year of operation, they purchased green coffee beans then began buying directly from growers (Jerry Baldwin Bio).
Howard Schultz’s first experience was similar as most customer that walk into a Starbucks store. When he first walked into a Starbucks Coffee Company Store in 1981 he fell in love. Schultz did not fall in love with carefully chosen coffee beans that make the coffee, similar to new Starbucks customers.
Starbucks Corporation is one of the world's largest coffee roaster, marketer, and retailer of coffee. In 1971, three entrepreneurs, Jordan Bowker, Zev Siegel, and Jerry Baldwin opened first Starbucks store in Seattle, WA. In 1982, Howard Schultz joined Starbucks as a marketing director. He came up with the idea to make Starbucks a coffee house chain but Starbucks founders rejected the idea and he left the company in 1985. Later, Schultz started his own coffee bar named “Il Giornale”. In a couple of years, he was able to buy Starbucks Corp. from its original owners. He renamed his coffee bars "Il Giornale" as Starbucks. In 1987, Starbucks opened its first store outside the Seattle in Vancouver and Chicago. In 1996, Starbucks opened its first international store in Tokyo, Japan. [1,2]
“… if you don’t measure something, you can’t manage it. And if we’re failing to measure how well we’re doing with our most important assets we’re probably not managing them very well,” (Kaplan, 2011, 1:48).
Over the past few decades, Starbucks has become a household name. Headquartered in Seattle, Washington, Starbucks is one of most lucrative coffee chains in the world. As of 2015, the company has chains in 50 countries with more than 22,500 stores in operation (Starbucks Corporation, 2017). The 70 stores located in Australia are focal point stores, which focus/tailor to improving the marketing strategy, customer service, and testing of new products to differentiate the company from the competition. Coffee is their primary business, so obtaining high-quality coffee beans from the nations that produce this product is important. Not only does the company sell hot coffee beverages, but they also offer a variety of cold drinks. The menu consists
Starbucks is the largest coffee chain industry in the world. In 2014 alone, Starbucks processed 2 billion dollars in mobile payment transactions (Elizabeth, 2015). Starbucks mobile app allows customers to transfer balance from their bank accounts to their Starbucks accounts for future purchases. Several customers have had money stolen from their Starbucks mobile app by thieves using smart new attacks.
For this assignment, I would like to choose Starbucks, a coffee company that loved by almost all the coffee lovers over the world. This company has founded by 3 partners that are University of San Francisco students, English teacher Jerry Baldwin, history teacher Zev Siegl, and writer Gordon Bowker in Seattle, Washington, on 1971. Alfred Peet, the big entrepreneur in the business making and selling coffee, were their mentor by taught his style of roasting beans and the equipment needed to three of them. With his guidance, they started their company from a very small level with named Starbuck at Pike Place Market, Seattle.
Preparation as defined by Webster’s dictionary is the action or process of making something ready (Merriam-Webster Incorporated, 2014). Starbucks Coffee Company coffeehouses are famous for a meeting place to enjoy a flavor-filled coffee or tea along with a delectable treat with good friends, family, or coworkers. Starbucks sell premium coffee roasts for any person’s preference along with a wide menu of hot and cold drinks and treats to satisfy any customer (Starbucks Coffee, 2014). The value Starbucks sets into the economy, workplace, and in the products is visible in the mission statement. Year over year, Starbucks has been able to increase their revenues. No matter how the economy is doing, Starbucks has efficiently managed its cost structure by adapting and diversifying its product line-up allowing for increased profitability.
The company started its activity in 1971 as small coffee shop located in Seattle specialized in selling whole arabica coffee beans. After being taken over by Howard Schultz in 1982, following a rapid and impressive growth, by mid 2002 the company was the dominant specialty-coffee brand in North America, running about 4,500 stores, 400 international stores and 930 licenses.
Founded in 1971 at Seattle’s Pike Place Market, Starbucks Coffee, Tea and Spices, as it was originally called, has been “brewing-up” its famous blends in over 43 countries, including the United States. Now called Starbucks Coffee Company, business isn’t just about the coffee and tea anymore. Starbucks has its own line of bottled water, handcrafted beverages, fresh food, entertainment, merchandise and a Starbucks Card. The company has received numerous awards for their outstanding business practices. Fortune Magazine has ranked them as one of “The Best 100 Companies to Work For” in 1998, 2000, 2002, and 2008 (Starbucks, 2008). The Starbucks Experience provides consumers and the general public a direct line a of business communication. From friendly baristas to press releases from CEO Howard Schultz, Starbucks keeps its “partners” informed.
Entrepreneur Howard Schultz joined the company in 1982, and, after a trip to Milan, suggested that the company sell coffee and espresso drinks as well as beans. The owners rejected this idea, believing that getting into the beverage business would distract the company from its focus. To them, coffee was something to be prepared in the home. Certain there was much money to be made selling drinks to on-the-go Americans, Schultz started the Il Giornale coffee bar chain in 1985.
It is difficult for many to trade the taste and quality of Starbucks for cheaper alternatives such as the break room coffee. Yes, maybe the break room coffee is more convenient and free, but is it really that inconvenient to go grab a Starbucks? Also, is it really that expensive considering how wonderful the taste is? This is a common thought process of a frequent Starbucks coffee drinker. It is these thoughts that make power of rivalry moderate.
Gordon Bowker, Jerry Baldwin and Ziv Siegl founded Starbucks in 1971. Their goal was to sell the finest quality whole beans and ground coffees (Starbucks timeline and history, 2004). In 1982, Starbucks had grown to five stores and started serving coffee to restaurants and espresso bars. Harold Schultz was employed as the director of retail operations and marketing. Harold Schultz convinced the founders of Starbucks to open a downtown Seattle coffee bar, which opened in 1984. With the success of Seattle coffee bar, Schultz left Starbucks to start his own company named Il Giornale. In 1987, Il Giornale acquired Starbucks retail operations for 4 million dollars. In addition, Il Giornale changed its name to Starbucks Corporation and opened locations in Chicago and Vancouver, B.C. (Starbucks timeline and history, 2004).
Schultz continually sees opportunity and the ability for growth, with an increase in locations across the globe every year and the ability to keep up with the latest in technology (websites, online shopping, a Starbucks application with the ability to pay and reload loyalty cards on your smart phone), etc. It is pretty safe to say that Schultz exhibits numerous leadership traits and skills that Gary Yukl, Professor of Management and Psychology at the University at Albany (State University of New York) believes are associated with effective leaders. Schultz has been adaptable throughout the years that he has been with Starbucks, you can see this in the way he has changed Starbucks’ food items to create better quality items, his ability to keep up with technology with the Starbucks application for smart phone users, and his expansion with taking Starbucks locations globally. Starbucks takes their partners very seriously, as well as their well-being.
Starbucks is a worldwide company, known for is delicious brews of coffee and seasonal varieties of tasty drinks for any occasion. Starbucks opened with two main goals, sharing great coffee with friends and to help make the world a little better. It originated in the historic Pike Place Market of Seattle, Washington in 1971 by Jerry Baldwin, Zev Siegl and Gordon Bowker. The creation of Starbucks’ name came from the seafaring tradition of early coffee traders and the romance evoked from Moby Dick. At the time, this individual shop specialized in the towering quality of coffee over competitors and other brewing services enabling its growth to becoming the largest coffee chain in Washington with numerous locations. In the early 1980s, the current CEO Schultz saw an opportunity for growth in the niche market. After a trip to Italy he brought back the idea of a café style environment of leisure and social meetings to the United States we now see in Starbucks locations today. Schultz ultimately left Starbucks to open his own coffee shop, Il Giornale which turned out to be a tremendous success. Fast forward a year later, Schultz got wind that Starbucks was going to sell all their components of Starbucks including their stores and factories, he immediately acquired the funds to buy Starbucks and linked both operations. Within five years he was able to open more than 125 stores starting in New England, Boston, Chicago, and gradually entered California. He wanted Starbucks to be a franchise system based on the mission of telling the truth and emphasize the quality,
For this organizational analysis, I decided to analyze Starbucks. I chose Starbucks because they are the leading innovators in socially impactful business activities and personally, I love Starbucks coffee! Obviously, the point of this paper is not to talk about how good their products are, but to analyze how their organization is structured and identify potential for improvement. I have never worked at a Starbucks, but I have two friends that work at the location inside of Hy-Vee in Cedar Falls. After countless hours of research, talking to my friends about day-to-day activities, and actually going to Starbucks on numerous occasions over the past few years, I knew this was the organization that I would love to analyze.
In 1971, three young entrepreneurs began the Starbucks Corporation in Seattle Washington. Their key goal was to sell whole coffee beans. Soon after, Starbucks began experiencing huge growth, opening five stores all of which had roasting facilities, sold coffee beans and room for local restaurants. In 1987, Howard Schultz bought Starbucks from its original owners for $4 million after expanding Starbucks by opening three coffee bars. These coffee bars were based on an idea that was originally proposed to the owner who recruited him into the corporation as manager of retail and marketing. Overall, Schultz strategy for Starbucks was to grow slow. Starbucks went on to suffer financial losses and overhead operating expenses rose as Starbucks continued its slow expansion process. Despite the initial financial troubles, Starbucks went on to expand to 870 stores by 1996. Sales increased 84%, which brought the corporation out of debt. With the growing success, Starbucks planned to open 2000 stores by year 2000.