September 9th, 2012
When entering a global market, it can be expected to overcome both controllable and uncontrollable elements. The Starbucks organization is no exception to overcome these elements when entering the global market. According to text (2011) controllable elements are attributes such as firms characteristics, type of product, pricing of product, the amount of research conducted, promotions and the channels of distribution. Uncontrollable elements effecting Starbucks are competitive structures, domestic and international, varying levels of technology and cultural differences. Starbucks encountered revised incomes with the economic downturns of recent and it quickly realized that its gourmet product was among the first to be cut out of tightening budgets. The political, economic and cultural issues in foreign countries can be sudden and therefore, uncontrollable elements that should be taken into consideration and monitored carefully when entering into a foreign market. In addition, increasing competition is another uncontrollable element also present in foreign markets. This competition from rival shops pulls from potential profits and increases the risk for Starbucks business development in the foreign market, like Japan. Starbucks also encountered political and economic regulations when attempting to expand to France. In France, there are strict regulations and generous labor benefits (Cateora et. al., 2011). These uncontrollable elements make it difficult to enter the France market. However, Starbucks cannot control economic downturns, but it can choose which country’s economies they wish to do business in. Starbucks also faces risks as it inters the global market. The most obvious risk is its limitation of products. As a specialty product, Starbucks has a very limited product selection and this also limits business growth. The biggest risk associated with this is customer boredom. In an effort to increase growth and broaden...
Please join StudyMode to read the full document