Starbucks Coffee Company Invades the European Market

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In 1987 a young man, Howard Schultz began the Starbucks Coffee Company after buying out a small café chain bearing the same name. His book, Onward, co-authored with Joanne Gordon, provides an outline of Schultz’s experiences as CEO as well as crucial business decisions that he made along the way. Starbucks offers a unique coffeehouse atmosphere by encompassing the European-style café while providing each customer with an outstanding level of service quality. The company was referred to in Business Wire as being, “committed to offering the highest quality coffee and Starbucks Experience and conducting its business in ways that help foster social, environmental and economic benefits for communities in which it does business” (Pucik). This attitude reflects the core values of Schultz’s empire, which have transformed Starbucks Coffee Company into “one of the best worldwide brands” (Michelli).

Starbucks now accommodates over 60 million weekly visitors, spread throughout 59 countries all across the globe! This company has created what they call the “third place” in a customer’s life, after home and work. Schultz has been successful in creating “an alternative to the corner tavern or pub, a place where people could go to read their paper, eat a pastry or snack, and drink a great cup of coffee” (Allen & Wheat). By fulfilling this unknown need, Starbucks has been able to offer a service and product that consumers have responded to favorably.

Starbucks’ ultimate mission is “to inspire and nurture the human spirit one person, one cup, and one neighborhood at a time” (Schultz). It is this sense of compassion and belonging, to a community, that makes Schultz’s business endeavor so distinctive. As one of the fastest growing retailers in United States history, only seven years after its first store opening there were over 400 stores throughout the nation. Starbucks Coffee Company “was poised to expand at the rate of 200 stores a year and by acquisition – and even hoped to move into Europe and Asia” (Allen & Wheat). This rapid expansion has dually helped and hindered the brand name company within the United States and on an international level.

The European market has historically been one of the most difficult sectors for American-based companies to expand. With the extreme success of Starbucks nationally, Schultz opted to bring his company and its values across the Atlantic. Investors and consumers alike were skeptical at this idea; taking Starbucks’ inimitable coffee culture to the birthplace of the café. Culture, in this sense, is defined as “the particular set of shared answers to certain basic questions in the minds of a particular category of people” (Suder). There are thousands of different cultures around the world. Adapting to these groupings of people was one of the most important, and difficult, pieces in developing Starbucks Coffee Company worldwide.

Despite all odds, the global plan was put into place and Starbucks International was created in Schultz’s attempt to reduce “US growth to a more sustainable pace while ramping up internationally” (Schultz). The coffee was of the finest quality, but would the demand be high enough to profit? How would the Europeans take to this innovative spin on their café? This proved to be a crucial time in Starbucks’ expansion process, and there was small room for error. Schultz had to capture this market precisely, making changes that adapted the American company to better suit European countries, while staying true to the Starbucks Experience.

To succeed in Europe, many hurdles had to be overcome, both culturally and financially, “Europe has been a weak spot for the world's biggest coffee chain. The region is grappling with debt woes and austerity measures” (Baertlein). The European economy was experiencing financial instability during Starbucks International’s growth phase. By buying out local café chains and offering paid barista training for the...
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