October 18, 2012
This paper looks at Starbucks history and evaluates its current financial situation. Their sense of community, responsibility and social awareness has made Starbucks the company that it is today. Starbucks has adopted a unique culture that is hard to duplicate by other organizations. As stated on their website, the company’s vision is to establish Starbucks as the most recognized and respected brand in the world. The ideals, along with the leadership of Howard Schultz, Starbucks CEO, has helped position the company where it is today, which in turn has positively affected the financials of the organization. This paper examines the financials and makes recommendations for new technologies for Starbucks to increase overall profitability of the company.
Starbucks is a company that has experienced substantial growth and success in the coffee industry. They operate with a unique culture that has not been matched by any other organization. Starbucks’ growth and strong financial standing, allows for the company to further invest in its customers and individual stores. How should Starbucks invest money to increase the overall experience for the customer? Providing its customers with a unique experience is one that Starbucks takes pride in. To maintain the spirit of the organization and give the customers a unique experience, kiosks located at each customer table will be the recommendation to achieve the company’s goals while aligning with its current strategy. Starbucks first opened their doors in 1971. Since inception, their motto has been to “share great coffee with our friends and help make the world a little better” (Starbucks, 2012). To this day, the original motto of Starbucks is instilled on the employees. The company and its employees have great passion for coffee and its customers, which helps keep the original motto alive. In the beginning, the company was a single store in Seattle’s historic Pike Place Market. From just a narrow storefront, Starbucks offered some of the world’s finest fresh-roasted whole bean coffees. The name, inspired by Moby Dick, evoked the romance of the high seas and the seafaring tradition of the early coffee traders. (Starbucks, 2012) Starbucks chairman, president and chief executive officer Howard Schultz had first walked into a Starbucks store in 1981. Howard fell in love with the coffee and the company with his first cup of Sumatra. He was drawn in and joined the Starbucks team a year later in 1982. (Starbucks, 2012) This was the beginning of what would ultimately be the start of a powerful combination of a great product with a forward thinking mind that would help bring the company to the level of success that it enjoys today. In 1983, Howard traveled to Italy and became captivated with Italian coffee bars and the romance of the coffee experience. He had a vision to bring the Italian coffeehouse tradition back to the United States. He wanted Starbucks to be a place for conversation and a sense of community. A place people could go to between work and home. He left Starbucks for a short period of time to start his own coffeehouses and returned in August 1987 to purchase Starbucks with the help of local investors. (Starbucks, 2012) From the beginning, Starbucks wanted to differentiate itself from other organizations. It not only wanted to celebrate coffee and the rich tradition, but it also wanted to bring a feeling of connection. Their mission is to inspire and nurture the human spirit – one person, one cup, and one neighborhood at a time. (Starbucks, 2012) Today, with more than 17,000 stores in 55 countries, Starbucks is the premier roaster and retailer of specialty coffee in the world. And with every cup, we strive to bring both our heritage and an exceptional experience to life. (Starbucks, 2012) Starbucks rich history has led to their ever growing financial success. The income statement gives a picture of the...