Costa Coffee Case Study

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Costa Coffee , is a company that is founded in 1995 by an italian brothers (Sergio Costa & Bruno Costa) in England. They first started as a Coffee Bean wholesale business , catering to the needs of local cafes and coffee houses. With their Italian background and experience in mixed roasted coffee beans that Sergio learnt in Parma, Italy, The Costa brothers gradually established their own unique style of roasting coffee beans. They go through a low temperature , slowly roasting the coffee beans, so that the final product has a fragrant and bitter less taste. Shanghai And Beijing.

Today, Costa have stores all across the United Kingdom, and other retail stores also include Ottakar 's Waterstones Bookshop, WHSmith and Homebase stores , Marriott
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Instead , the company should aim to introduce Coffee as a relaxing and common activity for the chinese population. The best way for the company to achieve this is to give the customers the impression that coffee is a part of their life , and this can be done by increasing more shops and advertisements in the community. However , it is very exhausting and time consuming for Costa Coffee to try and manage all the coffee chain outlets in China. And so , The master franchise program is introduced in the China region.
Costa Coffee have adapted to a master franchise rights program , in which Costa signs a franchising contract that hands over the control of franchising activities and rights in a specified territory/province to a person or an organisation. Costa is an ever-changing , highly competitive coffee industry leader , it not only has the status of industry leader , but also has a worldwide business network. In this industry that faces many challenges and opportunities , with extraordinary vigor and hopes to become a global organization but at the same time with many rooms for
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Most coffee shops are operated at locations where population is dense and income is high. However, as a result, the rental prices are very high. Costa Coffee could consider opening new shops at bus stations / other busy intersections where rents are lower but traffic is big. The marketing strategy that will be followed to China is very significant since it also influence neighboring countries like South Korea which is also a new coffee consuming country. If Costa Coffee fails to change the public opinion of the highly expensive coffee , it will be a matter of time before the consequences will be similar to Taiwan and Hong Kong where there is a negative trend in coffee business growth.

In China , it is rather difficult for overseas corporations to introduce their business into the domestic China market , The government hold many restrictions to them such as limiting their capital investment and cash flow. The government tend to encourage local businesses to do well , and is afraid that international organisations will pose a threat to them. However , this is not specified in joint venture

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