Beans to a Cup: The Commodity Chain of a Cup of Coffee
argumentative Essay
1269 words
Coffee is a growing part of people’s daily lives. Just before the 9-5 weekdays, and even during the 9-5, it is common for the working class to drink a cup of coffee. To support this accustomed part of our culture, it involves a complex supply chain that allows those coffee beans to turn into a cup that can be consumed. This paper is structured on how Starbucks, the top coffee supplier in the world, can supply its stores, from raw materials to manufacturing, right to the start of someone’s day.
CEO of Starbucks, Howard Schultz, originally had the idea that Starbucks would have the community/traditional feel in their stores, and still serve high-quality coffee (“Our Heritage” 1). Adding an Italian vibe to the coffee shops, keeping its traditional logo, which is based on a mythical creature, and advertising some of its products in a more “traditional” style accomplished the first goal. For an example, Starbucks recently created a commercial about their Refreshers, which was about cooling someone down in the summer time, with the scenery of Tuscany in the background. Serving high-quality coffee was obtained by ordering coffee beans from where they naturally grow and giving it a perfect roast to give to a customer. It was a marketing strategy that helped Starbucks grow and transform its commodity chain to support gathering more raw materials for a cheaper and more efficient way.
The most important part of the cup of coffee, the coffee beans, is typically harvested from South America, mainly because of the fact that Starbucks uses Arabica beans (Weinberg 1), which is dependent on a temperate climate that exists on the majority of the continent. The country that provides the biggest market supply of coffee beans for Starbucks is Brazil ...
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...l Could Leave 700 Elmhurst Dairy Workers Unemployed." NY Daily News. N.p., 15 June 2011. Web. 11 Nov. 2013. .
"Our Heritage." Starbucks Coffee Company. N.p., n.d. Web. 13 Nov. 2013. .
Root, Jessica. "Green Living." TLC. Planet Green, n.d. Web. 11 Nov. 2013. .
T., Kate. "A Cup of Low-Cal Goodness." Starbucks Coffee Company. N.p., 16 Apr. 2010. Web. 11 Nov. 2013. .
Weinberg, Benett A. "Burned Beans — The Shame of Starbucks." World of Caffeine. N.p., 09 Mar. 2011. Web. 08 Nov. 2013. .
In this essay, the author
- Explains how starbucks, the world's top coffee supplier, can supply its stores from raw materials to manufacturing, right to the start of someone’s day.
- Explains how howard schultz, the ceo of starbucks, originally had the idea that starbucks would have the community/traditional feel in their stores, and still serve high-quality coffee.
- Explains that starbucks uses arabica beans from south america, which is dependent on a temperate climate. the cost of production has been higher than the price per pound of coffee, causing an increase in farmer debt.
- Explains that starbucks gets its sugar from maui, hawaii. the turbinado sugar is what is left of natural cane sugar after being stripped of its minerals at a refinery.
- Explains that starbucks plans on reducing their waste by creating a reusable cup, which is made out of #5 plastic.
- Explains that starbucks receives its milk from bartlett dairy, which is a middleman company, while dean foods is the country's largest milk producer.
- Explains that the commodity chain for starbucks is complex because it is the world's biggest coffee chain that provides international surface all across the globe.
- Concludes that starbucks' commodity chain transformed from supporting to one mom and pop maritime-based coffee shop in seattle to supporting an italian coffee corporation that is spread out over 62 countries.
- Explains that sugar in the raw's "behind the scenes at starbucks supply chain operations it’s plan, source, make & deliver."
- Explains that horizon organic stewardship facts - september 2011 was published on wikispaces.
- Explains that california, 2011. web. 08 nov. 2013. kolecki, catherine. how products are made.
- Explains that starbucks' new milk distribution deal could leave 700 elmhurstdairy workers unemployed.
- Analyzes starbucks' "our heritage." starbucks coffee company. n.p., n.d.
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- Starbuck’s and the Environmentexplanatory essayCoffee is a worldwide cash crop of which demand has exponentially increased over the years. “Coffee is (after oil) the world’s second most important traded commodity” (Cleaver 61). Competing coffee brewing companies wage war on offering the freshest, best tasting coffee the market has to offer. With such stiff competition there must be enough coffee beans deemed to be good enough in quality to supply the increasing demand. Starbucks can be considered one of today’s top competitors if not thee top coffee manufacturer presently in business. This successful company has had a huge impact on the coffee industry as well as the world. They have gone through great length to provide consumers with an excellent product as well as create a legacy that shows how to best go about running a massive corporation while keeping the environment clean and healthy.
In this essay, the author
- Explains that coffee is a worldwide cash crop of which demand has exponentially increased over the years. competing coffee brewing companies wage war on offering the freshest, best tasting coffee.
- Explains that starbucks utilizes only the highest quality coffee beans for their products, which requires them to carry out a rigorous quality control process. coffee beans vary in complexity and taste depending on where they are grown.
- Explains that starbucks collects coffee from thousands of farmers in over 30 countries even though these family farms have only a few dozen acres. the 1994 genocide in rwanda is of special interest to the founder.
- Explains that starbuck's roasting process is a delicate process involving heats and time that extracts the full flavor and richness from that tiny little bean.
- Opines that a successful company like starbucks has an impact on the society as well as the world.
- Explains that coffee is a naturally farmed substance with no harmful waste associated with it.
- Cites domosh, mona, roderick neumann, patricia price, and terry jordan-bychkov. the human mosaic: a cultural approach to human geography.
952 wordsRead More - Starbucksexplanatory essayStarbucks at the time did not typically sell coffee drinks. Beans and coffee makers were their forte. In 1983, Schultz traveled to Milan, Italy, where he was struck by the numerous coffee bars. He saw “not only the romance of coffee . . . but a sense of community” in these c...
In this essay, the author
- Explains that they apply the highest standards of excellence to the purchasing, roasting, and fresh delivery of their coffee.
- Explains that starbucks was founded by jerry baldwin, gordon bowker, and zev siegl on march 30, 1971.
- Explains that starbucks' mission statement is to inspire and nurture the human spirit — conducting their business ethically and striving to do the right thing are a vital part of the company.
- Explains how howard schultz resigned from the ceo position at starbucks in 2000. he appointed orio smith to this position and to the position of president of the company.
- Explains that starbucks coffee was removed from the company's logo in 2011, leaving only the picture of the mermaid. schultz struck a deal with green mountain coffee roasters to distribute starbucks coffees and teas for keurig single-serving systems.
- Explains that there are more sizes of coffee than those listed on the menu. the trenta size at starbucks is larger than the capacity of the average human's stomach at 916 milliliters.
1995 wordsRead More - Starbucksopinionated essayStarbucks is currently the industry leader in specialty coffee. They purchased more high quality coffee beans than anyone else in the world and keep in good standings with the producers to ensure they get the best beans. Getting the best beans is only the first part, Starbucks also has a “closed loop system” that protects the beans from oxygen immediately after roasting to the time of packaging. They did this through their invention of a one-way valve which let the natural gasses escape but keeping oxygen out. This gave them the unique ability to ensure freshness and extended the shelf life to 26 weeks. Starbucks isn’t only about the coffee, it’s also about a place where people can escape to enjoy music, reflect, read, or just chat. It is a total coffee experience. The retail outlet has been responsible for much of Starbucks growth and has contributed substantially to their brand equity.
In this essay, the author
- Explains that shultz and starbucks have to decide how to react to the opportunities that are being made available because of their rapid growth. a strategic growth plan has to be made in the near future.
- Explains that starbucks is the industry leader in specialty coffee and has a closed loop system that protects the beans from oxygen immediately after roasting to the time of packaging.
- Analyzes how starbucks' supply chain operations haven't caused any problems yet, but they have yet to come up with a long-term solution for such possible problems.
- Explains that starbucks has many opportunities of which it can take advantage, including a joint venture with mcdonald's, and the bottled frappuccino product that pepsi and starbucks have created.
- Explains that starbucks must be aware of the threats of competing in a particular industry, such as political unrest or currency changes in the counties from which it acquires its beans.
- Opines that starbucks could create a special brand of coffee just for mcdonalds that doesn't use the starbucks name.
- Opines that the second alternative is to push the frappuccino product that both pepsi and starbucks created into national distribution.
- Opines that franchising coffee carts would spark lots of interest and provide a fast move into many markets.
- Proposes a vertical and horizontal integration for starbucks to gain more control over their coffee production.
- Recommends that starbucks implement their strategy correctly, such as getting a deal with mcdonalds without using the starbucks name, and selling franchise right for coffee carts.
1328 wordsRead More - Case Study: Target Market For Starbucksexplanatory essayStarbucks, a coffee bean sales company did not have much of a marketing plan in place at its inception. Based in Seattle Washington the company began to sell coffee beans to espresso bars and upscale restaurants back in 1982. It took 11 years to progress to that level of production, they originally were a local store vendor at Pike Place Market. The director of marketing brought back the espresso bar idea from his travels in Milan. (Company Profile, 2015) The Pacific Northwest was filled with working class men and women that were drawn to the coffeehouse tradition brought in from Italy.
In this essay, the author
- Describes a useful aid for organizing information utilizing its strengths, weaknesses, opportunities, and threats.
- Explains that product recalls have hurt the starbucks brand as recently as 2015. specialization is a strength, but diversification and marketing products are weakness.
- Explains that product diversification has allowed starbucks to repackage their products and distribute it as a home product. the opportunity for continued expansion is present.
- Explains miller, r. k., food and beverage market research handbook. coffee shops.
- Explains william d. perreault, j. j, essential of marketing, a marketing strategy planning approach.
- Explains that starbucks didn't have a marketing plan in place at its inception. the company began selling coffee beans to espresso bars and upscale restaurants in 1982.
- Explains that starbucks' primary business is that of selling high-premium coffee. specialization allows them to deliver great quality and maintain their customer base. involving technology with their market structure.
- Opines that a marketing team along with data and analytics is essential to comprising the new product.
903 wordsRead More - Starbucks SWOT Analysisopinionated essayHowever, such success requires high maintenance. In fact, due to high competition and declining revenues, in year 2005, Starbucks introduced new products to their menu, which included pastries, sandwiches, and deserts. Such strategy helped the company regain its market power. Regrettably for the investors, such static fixture provides only a short-term relief in a highly volatile and competitive market. Mr. Schultz have expressed his concern that the company is taking a route that is causing the brand to lose its well known image of friendly coffee house (Seaford, et. al, 2012). The market that was once cornered by Starbucks has started to slip away from the grips of the company once McDonald’s, Dunkin Donuts,...
In this essay, the author
- Explains how starbucks was inspired by the book and movie about moby dick. howard schultz introduced the new italian coffee bean and italian style of coffee drinking.
- Opines that starbucks is taking a route that is causing the brand to lose its well-known image of friendly coffee house.
- Explains that starbucks refocused its attention on coffee in 2009, and introduced via instant coffee to steal back the market that was once theirs from the competitors such as panera bread.
- Explains that branding a new product is not as easy as placing it on the shelves and hope for the consumers to buy it. a strong marketing team is required for affective branding, as they understand the issues while doing so.
- Opines that starbucks has done a good job for packaging their instant coffee.
- Opines that starbucks must increase its advertising budget and increase the use of the media to counter the said problems.
- Explains that the key issue starbucks via faces is the negative image already engraved in consumer’s mind by other brands of instant coffee.
- Explains that there are many solutions to brand via now that the key issues have been identified. the company must try to lower the price by cutting unnecessary overheads such as excessive advertisements.
- Explains that starbucks has done a great job with the current packaging, but it's flawed. the most effective packaging is the one that advertises the product until the end of its consumption.
- Recommends a few starbucks via cups with each package sold to keep the overhead cost moderately low. they also recommend giving customers the option to purchase additional cups for $0.10.
- Explains that via brand will be starbucks minus the baristas-and the brewing.
- Explains starbucks' mission statement, which can be found at http://www.starbucks.com/about-us/company-information/mission-statement.
1431 wordsRead More - The Target Market: The Case Of Starbucksexplanatory essayWhen Starbucks started their target market were people who enjoyed coffee not just for the energy boost that they got from the caffeine, but people who enjoyed sitting down and drinking a well-prepared cup of coffee. Upon visiting Italy and falling in love with the coffee bars and the experience that they offered, Schultz envisioned a place between home and work where you could just sit and enjoy your coffee. Starbucks wanted to control their coffee from “raw green bean to the steaming cup” this meant that they had to talk with their farmers to make sure the quality was up to their standards. They
In this essay, the author
- Describes howard schultz's target market, and how starbucks was positioned to appeal to this market.
- Explains that starbucks wanted to control their coffee from "raw green bean to the steaming cup." they used manual coffee pots to brew the coffee, which was more time-consuming but showed how dedicated they were to quality.
- Explains that wall street and starbucks management placed great emphasis on the company’s ability to continue its impressive growth rate. what were some of the growth initiatives undertaken by starbucks?
- Explains that starbucks wanted to establish a hub in the large city of the region as its model store and expand into smaller cities and suburban locations.
- Opines that starbucks' growth initiatives were sound in terms of generating wall street's growth, but which were inconsistent with brand positioning?
- Explains how starbucks started playing jazz and classical music in the shop. hear music allowed people to pick and choose which songs they wanted to put on a customized cd. the success of the music industry didn't roll over to movies.
- Explains how starbucks matured as a company from the early 1970s. they moved away from having to grind their own coffee to pre-ground coffee that was sealed on the bags to keep the coffee grounds fresh.
1025 wordsRead More - Coffee Supply And Demandexplanatory essayCoffee Supply and Demand Besides the high demand and cost for gasoline these days, coffee is considered the second most traded commodity on worldwide markets next to oil. "Coffee is grown in more than 50 countries in a band around the equator and provides a living for more than 20 million farmers. Altogether, up to 100 million people worldwide are involved in the growing, processing, trading and retailing of the product" (Spilling the Beans , ). In 2001, coffee farmers and plantations produced over 15 billion pounds of coffee while the world market only bought 13 billion pounds. The overproduction in the coffee industry is not a usual thing and is one of the major reasons why prices vary throughout the industry.
In this essay, the author
- Explains that coffee is the second most traded commodity on worldwide markets next to oil. overproduction in the coffee industry is one of the major reasons why prices vary throughout the industry.
- Explains that starbucks is the leading retailer, roaster, and brand of specialty coffee in the world.
- Explains that starbucks has over 8,700 retail locations in north america, latin american, europe, middle east, pacific rim and is continuing to grow.
- Explains that starbucks is making an alliance to ensure that a sustainable supply of high quality coffee is produced in latin america.
- Explains that the weather affects the consumption of coffee. people drink more coffee in the winter due to the cold temperature, shorter days, and the fact that it is harder to get going without a cup during the holidays.
- Explains that coffee is one of the highest taxed products in the united states. the tax on coffee went up to about 10 cents per cup, on top of all the tariffs.
- Explains that the amount of coffee drinkers in the last decade has gone up from 71 to 76 percent, and the average cup per day has increased from 3 to 3,5 cups. the aging of the baby boomers and their increasing spending power create a good customer base for the coffee shops.
- Explains that supply and demand are the key words to economics and is the answer to many questions that pertain the shift in prices.
- Explains that supply refers to a schedule of quantities sellers are willing to sell per unit of time at various prices. individuals control the factors of production, inputs or resources necessary to produce goods.
- Explains that supply is fundamental to the invisible hand's ability to coordinate an individual’s actions in the market.
- Opines that starbucks isn't going to do worse than its competitors in the coffee industry. starbucks can look forward to a prosperous future as long as nothing too severe happens to our economy.
927 wordsRead More - Starbucks Financial Analysisargumentative essayThe story of Starbucks coffee history begins in Seattle in 1971 when the first Starbucks opened at Pike Place Market, which is Seattle's and the Nation's oldest Farmer's Market. At this time the company was a local coffee roasting facility. That remained their core business until 1982 when Howard Schulz joined the company. He was the new marketing executive and began right away to convince more and more local cafes, upscale restaurants, and hotels to buy Starbucks coffee. The turning point for the company and the beginning of coffee history should be one year later when Schulz traveled through Italy. He got inspired by the Italian coffee bar tradition to serve fresh brewed Espresso and Cappuccino. He convinced the Starbucks founders to give his idea a chance and in 1985 he opened the first coffee bar in Seattle, named Il Giornale. (Wilson)
In this essay, the author
- Explains that starbucks is the world's largest specialty coffee retailer, with more than 16,000 retail outlets in 35 countries.
- Explains starbucks has increased in both total revenue and net income by averages of over 20% each year in the past five years. there was a drop in income in 2006.
- Explains that the cost of revenue, or goods sold, is 86.3% of the total expense distribution for starbucks.
- Explains that current assets make up 31.75% of starbucks corporation's total assets, while property/plant/equipment totals add up to 54.1% of its assets.
- Explains that starbucks' current liabilities make up 70.5% of its total liabilities. starbucks has never issued preferred stock.
- Explains that starbucks' current ratio is almost half of the industry average, suggesting that they are not as solvent as the rest of restaurant industry to obtain short-term capital.
- Explains that asset turnover measures a firm's efficiency at using its assets in generating sales or revenue. starbucks' much higher number than industry average indicates the company is efficient in how it utilizes their assets.
- Explains that a debt-to-asset ratio of no more than 50 percent has been considered prudent. a higher ratio indicates an overuse of leverage, and it may indicate potential problems meeting the debt payments.
- Explains that starbucks has less than half the industry average for profit margin, while starbucks' return on assets is slightly higher than industry averages.
- Recommends buying starbucks at the current discounted price and holding it in the portfolio for the future.
- Narrates the story of starbucks coffee history beginning in seattle in 1971 when the first starbucks opened at pike place market. howard schulz convinced local cafes, upscale restaurants, and hotels to buy starbucks.
- Explains that starbucks corporation engages in the purchase, roasting, and sale of whole bean coffees worldwide.
- Analyzes how howard schultz's memo to starbucks executives led to the watering down of the starbucks experience and commoditization of its brand. the tough economy is hurting retailers and restaurants.
1484 wordsRead More - Schultz's Case Study: A Brief Background Of Starbucksanalytical essayStarbucks 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,
In this essay, the author
- Explains that starbucks originated in the historic pike place market of seattle in 1971 by jerry baldwin, zev siegl, and gordon bowker.
- Explains that starbucks' success is due to their ability to address internal and external factors. the certs framework helps indicate the most important influential factors and characteristics in the macro-environment.
- Explains that starbucks has 26.48% of the total market share, making it the industry leader over mcdonalds, peets and other coffee beverage producers. there is a moderate threat of new entrants into the existing market place.
- Explains that economic forces are extremely important in order to improve profitability, future business growth, and increase market place. starbucks has laid out the coffee-buying guidelines, while being social and environmentally responsible.
- Explains that starbucks faced declining sales due to economic downturn and consumers shifted their tastes towards cheaper, more affordable products.
- Analyzes how the increase in technology in today's generation has positively affected starbucks' customer satisfaction levels. the "starbucks app" allows customers to order specialized drinks, create new drinks or accumulate points towards a free drink.
- Explains that starbucks uses the marketing mix to develop business growth and consumer engagement. they offer a variety of products to capture more of the market and customer needs while attracting new customer base.
- Recommends that starbucks acknowledge the increase of home usage of coffee makers by creating more home brew products or lines such as roasting machines.
- Cites zacks investment research's starbucks corporation (sbux) forecast earnings growth.
1431 wordsRead More - Target Market Analysis of Starbucksexplanatory essayKen Boyer. 2013. Behind the Scenes at Starbucks Supply Chain Operations it’s Plan, Source, Make & Deliver. [ONLINE] Available at: http://www.supplychain247.com/article/behind_the_scenes_at_starbucks_supply_chain_operations/green. [Accessed 20 April 14].
In this essay, the author
- Explains that starbucks was established in 1971 with their first store in western avenue from that same year to 1976. they believe in serving the best coffee by growing the coffee under quality standards.
- Explains that starbucks works with over 18000 stores worldwide to ensure supplies are always available to their customers. starbucks started "grounds for your garden" in 1999 to make their business more environmentally friendly.
- Explains that starbucks target market is mainly adults between the ages of 25-40, these customers account for almost half (49%) of starbucks total business.
- Explains that starbucks target market ranges from the ages of 18-40, both male and female. the income of these people depends on the life-stage individuals are at right now.
- Explains the starbucks distribution channel, which consists of getting the best coffee beans from the farm and then brewing it in factories. starbucks also works hand in hand with the company that produces their mugs and cups.
- Explains that market positioning is a way to put in perception which you want to the mind of the customers.
- Explains the products offered at star bucks include coffee, tea, cold drinks, buns, sand witches and plenty of other items.
- Describes the things that need to be considered before the prices of products are generated.
- Explains that each individual has his/her own wants, so they decided to price each cup of coffee according to the ingredients chosen by the customer and the total is then given out.
- Explains that promotion of products is a must for it to sell. proper advertising, proper marketing, and creating buying incentives are needed for proper promotion.
- Explains that a coffee shop needs to be located in an area that attracts large numbers of customers, such as shopping malls, schools, offices, and drive-through services.
- Explains that before starbuck?s existed, a consumer would buy canned supermarket coffee as the standard means of getting coffee.
- Explains that starbucks is one of the most recognized brands in the market and their market share seems to grow every year.
- Explains that starbucks' products are pricy, which may be a weakness for the company because customers may choose cheaper alternatives. starbucks has to maintain their expected brand image.
- Opines that expanding into emerging markets would be a better advantage for starbucks. starbucks recently introduced an app called mobile pour, which would attract more customers.
- Opines that competition may be a threat to starbucks because other companies may come up with something that they lack and/or customers may prefer going to other coffee shops because of the price.
- Explains that the bcg matrix shows different products of starbucks, and according to the matrix one will be able to tell which product is highly demanded in the market and what isn't.
- Analyzes how starbucks has applied positioning to its market. target segmentation is the process used by organisations to target a précised category of customers with various needs, wants, and characteristics.
- Explains that starbucks gave themselves the position as a premium product in the coffee industry by producing and incorporating high standard, initiating innovative products and offering exceptional service. schultz was aware of the fact that coffee is extremely perishable item and practised high level of quality.
- Explains that starbucks catered really expensive products and it was in accordance with theory that the price which the customer gives to the seller for a particular quality, this price was evaluated as the quality of the product.
- Opines that starbucks should slow down the expansion process internationally and pay more attention to marketing new products and its brand name.
- Explains market segmentation, target market selection, and positioning. 2005. subudhi, r., 2014.
- Explains ken boyer's behind the scenes at starbucks supply chain operations itâ€tms plan, source, make & deliver. nithin geereddy.
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