business report cafes

Topics: Coffee, Types of business entity, Corporation Pages: 11 (3742 words) Published: September 10, 2014

Starbucks Corporation Analysis

Business entity of Starbucks
Starbucks is the largest coffeehouse corporation in the world. A corporation is different from other forms of businesses because it’s considered a legal entity that is completely different from its shareholders. This means that the shareholders aren’t responsible for the corporation’s actions, they are only held accountable for their own investment. Starbucks Corporation is responsible for its own actions, can sue or be sued, can buy or sell property, can enter binding contracts, and can be taxed. Also, Starbucks has a board of directors because it is a corporation. The job of the board of directors is to govern the corporation. They oversee major policies and decisions made by the corporation; they hire and evaluate the CEO (Howard Schultz), set goals and hold management accountable for achieving them. This corporation is owned by shareholders, who are defined as the investors of the company and they are entitled to pick the board of directors. They are payed in dividends which are distributed by the board of directors. In the case of Starbucks, and all corporations, there are many positive and negative aspects to acquiring this type of business entity. The positive aspects, that Starbucks Corporation has, are that it has easier access to financing because all its shareholders, it will be allowed to exist beyond the lives of its owners, has talented employees, and the owners have limited liability. However, Starbucks has negative aspects such as a costly setup and has many regulations and government oversight, it is a subject to double taxation, and there may be differentiated goals between the shareholders and the corporate managers.

Target Market of Starbucks
The Starbucks located in la Fontana, in the district la Molina, has a primary target that is generally focused on customers of Tottus, students of USIL, and people that work, and live near that location. However, after doing further studies I have been able to further categorize the target market in three categories, which are the following: Adults 

Starbucks’ primary target market is men and women aged 25 to 40. They account for 49 percent of its total business. Since coffee is most common to people in this age, it is their primary target market. Customers tend to be urbanites with relatively high income and professional careers. The reason for this is because the prices of their products are generally expensive. According to the people I interviewed in that location, many people go to Starbucks to read, do work or to simply drink coffee because they enjoy it.

Young Adults 
Young adults, which are aged 18 to 24, total 40 percent of Starbucks’ sales. Starbucks is a place for young adults to socialize, take a break from college studies, do term papers or reports, etc. This is one of the main reasons for why Starbucks has unlimited internet (Wi-Fi).  Many of these young adults come from USIL.

Kids and Teenagers 
Kids and teens are also a large part of Starbucks’ target audience. These customers are of age 13 to 17 and most items for kids are purchased by the parents. Whether it is whipped cream topped coffee or steamed milk, these costumers form a big part of Starbucks’ sales. While kids go there with their parents, Starbucks is also known as a place where teenagers socialize. Most of these teenagers come from schools near the location or from USIL.

International Operations of Starbucks
The first location outside of North America, where Starbucks operated, was in Tokyo, Japan. Since then, Starbucks has operated in 50 different countries, with over 16,000 stores. Starbucks Corporation maintained a franchise under its subsidiary, Seattle’s Best Coffee, which was acquired in 2003. At first, Starbucks amplified its brand through distinct business partnership alliances. Even though Starbucks Corporation wasn’t considered a franchise, it still maintained its principles through similar...
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