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STARBUCKS COFFEE

I. Strategic Problem: How can Starbucks Coffee Corporation continue to provide exceptional employee benefits package while pursuing a globalization strategy?

II. Analysis of the Problem:

A. Company Background and History:

1. Founders.

a. Starbucks began in 1971 when three scholars-English teacher Jerry Baldwin-history teacher Zev Siegel, and writer Gordon Bowker- opened a store called Starbucks Coffee, Tea and Spice in the touristy Pikes Place Market in Seattle.

b. The inspiration and mentor for the Starbucks venture in Seattle was a Dutch immigrant named Alfred Peet, who had opened Peet’s Coffee and Tea, in Berkeley, California, in 1966.

c. Starbucks Coffee at this time stood for making top-quality, fresh-roasted, whole-bean coffee which was its differentiating feature.

d. The company was created to build clientele in Seattle that would appreciate the best coffees and teas.

e. Baldwin and Bowker key mission for their business was to maximize the quality of the coffee. The company purchased the finest Arabica coffees and put them through a meticulous dark-roasting process to bring out their full flavors.

f. In 2000, Howard Schultz transitions from chairman and CEO chief global strategist; Orrin Smith is promoted to president and CEO.

2. Starbucks and Howard Schultz.

a. In September 1992, Howard Schultz was hired at Starbucks.
b. Schultz’s 1983 trip showed him that there was much more to the coffee business than just providing quality beans. On his trip to Milan, Italy he had a revelation which made him see going to Starbucks should be an experience, a special treat, a place to meet friends and visit.
c. Howard Schultz presented his great idea to expand Starbucks to a retail business. They feared that providing drinks would hurt them because it could hurt the integrity of Starbucks’ mission as a purveyor of fine coffees.
d. In April 1984 , Starbucks opened its sixth store which was the first of the company’s store...

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...f the products and drinks. Most of the pricing of the products depends on how the economy is doing. Recently, last year there was a .10 cent increase due to increase in milk and price of coffee beans. The company had to raise their price in drinks in order to compensate the increase in price of their products.
2) The company should change advertising channels. Most of the company’s advertisement is by word of mouth because customers are very content with the product or service.

VIII. Conclusion: Currently Starbucks Coffee Corporation is a public company that has been highly profitable while maintaining international market share. As growth both domestically and globally are undertaken the company’s image will continue to flourish. The company needs to be aware that as it grows domestically and internationally it takes on more responsibilities. The benefit package it offers to its employees is quite remarkable but at the same time be aware that each county has different political and cultural barriers. As the company keeps expanding, it will need to take several precautions that will prepare them for any financial scares.

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