Starbucks developed continuously and rapidly after Howard Schultz bought it. It was entered in “Fortune 500 companies” in March 2003. Because of the saturation of the market, Starbucks can not only relied on the American market, but also had to venture abroad and paid close attention to the growth of subsidiaries. During the expansion, Starbucks stuck to its basic principles and innovated constantly to cater to the taste of the native. Although Starbucks was operated successfully, it also experienced losses in many countries and faced many challenges and risk.
It is essential for MNCs to choose the right mode of entry in any markets and make structural changes to motivate strategic changes, even mature MNCs, which can transfer some risk. Starbucks decided to use three strategies to enter into the international markets-licensing, wholly owned subsidiaries and joint ventures. Every strategy has its advantages and disadvantages, so managers of Starbucks need to consider carefully before entering other countries. Starbucks makes the different ways to enter in the markets according to the different situations of countries. For instance, Canada is close to America so the cultures and the habit of drinking coffee are close too. Starbucks chooses wholly owned subsidiary type to enter Canadian market. Some Asian countries such as Japan and Hong Kong, China, Starbucks selects joint ventures to get in these countries because their taste of coffee is different from American’s. Moreover, the strategic adjustment of Starbucks was to cover over an area in new stores. That can not only assist to disperse consumers and reduce their waiting time, but also decrease the costs and increase revenues. It also innovated some new products and cooperated with local companies. Culture, government, environment and the condition of Starbucks, all these can affect the choice of strategy. In short, before choosing strategy, managers of Starbucks ought to analyze the SWOT of Starbucks, the...
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