Everyone knows Starbucks is more expensive but that doesn’t stop them from buying it. At 10 am the Hazard Ave. Starbucks always has a line out the door. Why don’t those people just travel a minute down the road to Dunkin or McDonalds to get cheaper coffee? What it comes down to is, are you willing to pay more for a better taste coffee? Although some may argue that McDonalds or Dunkin’ has better coffee.
[ONLINE] Available at:http://scholar.harvard.edu/files/nithingeereddy/files/starbucks_case_analysis.pdf. [Accessed 18 April 14] Researchomatic ,Starbucks Market Segmentation And Positioning , http://www.researchomatic.com/Starbucks-Market-Segmentation-And-Positioning-103307.html( Accessed January , 17 , 2012).
Non food items: Mugs, Travel tumblers, coffeemakers, coffee grinders, storage containers, compact discs, games, seasonal novelty items, Starbucks card, media bar. International Business Development In order to achieve Starbucks mission to be a global company, the development strategy that Starbucks implemented to adapt with variety market and local need are: joint ventures, licenses and company owned operation (Starbucks Corporation, 2005). There are 4,666 Starbucks stores which are operated and 2,222 are licensed operation in US which are spread out in 50 states. For the international location, StarbucksÂ’ store can be found in 34 countries outside of the United States and 1,049 stores are company owned operated in Australia, Canada, China, Germany, Singapore, Thailand and the U.K. and 1,734 are joint ventures and licensed operation (Company Fact Sheet, 2005). Starbucks goes International 1996 Starbucks open in Tokyo, Japan.
This allowed Schultz to focus on Starbucks¡¦ global strategy. Starbucks operates and licenses more the 7,500 coffee shops in more than 30 countries. Coffee Industry In the United States, coffee is the second largest import (Roosevelt, 2004). Furthermore, the United States, consumes one-fifth of all the worlds¡¦ coffee (Global Exchange, 2004). The present industry is expanding.
Business Intelligence. Retrieved from: http://www.rodenberg.nl/publications/publications/COSTA_COFFEE_vs_STARBUCKS.pdf Schultz, H., & Yang, D. J., 1999. Pour Your Heart Into It: How Starbucks Built a Company One Cup at a Time (p. 351) Stigler, G. J., 1958. The Economies of Scale. Journal of Law and Economics, 1, 54-71.
Starbucks Corporation. (2014). Starbucks Coffee Company. Retrieved on 30th April, 2014 from http://www.starbucks.com Titman, S., Keown, A., & Martin, J.D. (2011).
In 1981, Howard Schultz, vice president and general manager of U.S. operations for a Swedish maker of coffee and kitchen equipment, visited Starbucks and was immediately enamored by the business philosophy and opportunity. For over a year Schultz pressed for a position at Starbucks and was finally hired in September 1982. However, Schultz’s vision to expand and reconstruct Starbucks conflicted with the owner’s desire to retain a retail focus. So, in 1986, Schultz struck out on his own and founded Il Giornale Coffee Company. The following year, Schultz acquired Starbucks for $3.8 million dollars when the owners decided to focus their attention on running Peet’s Coffee and Tea, which they had acquired in 1984.
· Low long-term debt to equity ratio of 0.01, company has good financial standing. · 1993, Opens second roasting plant in Kent, Washington in order to maintain on-time production and delivery, then in 1995 opened state of the art roasting facility in York, Pennsylvania. · Howard Schultz joins corporation in 1982, is a visionary leader who made Starbucks the famous coffee bar that it is today. In 2000, Schultz assumed role of chairman and chief global strategist. WEAKNESSES: · Low presence in third largest coffee market, Japan and Asia.