Analysis of Starbucks

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An Analysis of Starbucks

Company History

Starbucks was opened its first coffee company in Seattle’s Pike place Market on 1971. The name was taken from the first mate in Herman Melville’s Moby Dick (Company Profile, 2005).


Beverages: Brewed coffees, Italian-style espresso, cold blended beverages, roasted whole bean coffees, tea products, fruit juice, sodas, and coffee liqueur.

Food: Sandwich, Salads, pastries and ice creams.

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. Nowadays, there are more than 500 retails shops in Japan. Furthermore, Starbucks also open in Hawaii and Singapore.

1997 Starbucks open in Philippines

1998 Starbucks open in U.K., Taiwan, Thailand, New Zealand and Malaysia.

1999 Starbucks open in Beijing, Kuwait, South Korea and Lebanon.

2000 Starbucks open in United Arab Emirates, Honking, Shanghai, Australia, Qatar, Saudi Arabia and Bahrain.

2001 Starbucks open in Switzerland and Austria.

2002 Starbucks open in Oman, Germany, Spain, Mexico, Puerto Rico, Southern China, Macao and Shenzhen, Greece and Indonesia.

2003 Starbucks open in Turkey, Peru, Chile and Cyprus.

2004 Expansion to France

2005 The latest expansion in Jordan

Expand market into China

When did it enter into China?

In 1971, Starbucks opened its first coffee shop at Seattle. Since then, more and more coffee stores scattered across the United States and Canada. The serious problem which Starbucks faced to was saturated home market. In 1996, therefore, Starbucks expended its retail business to overseas, with new locations in Japan, Hawaii, and Singapore orderly, while keeping increase of profit in its home market (Qin, 2004).

Where did it choose first? And then where?

It was until 1999 that the first Starbucks entered into Beijing, China. After that, it opened around 165 outlets in several big cities in this country, such as Beijing, Shanghai, Guangzhou, Hong Kong and so on.

Why choose China as target market?

China, after the United State, will be expected to become the second largest coffee-consuming country, which has approximately 1.3 million potential consumers. Urban consumers are recognized as one of main coffee-consuming peers in China It is because that most of them have conception of Western culture by the media, such as TV programs, and accept it easier than person in the suburbs, where is poor and lack of communications. It appeals to the huge number of expatriate living in China. It is reported that Westerners and businessmen from Hong Kong and Taiwan represent 30% of customers at chained cafs such as Starbucks (Carter, 2004). Moreover, a perspective growth in production of coffee beans in China appealed to Starbucks’ investment. Since 1988, when a project of coffee growing area began in Yunnan province, the production growth of coffee beans has increased rapidly. In 1995, it reached 4,000 hectares and more than doubled by the end of 1998 (Dharmananda, 2005). The United States Department of...
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