Starbucks Strengths and Weaknesses

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After reading Starbucks’ “Management Discussion and Analysis” portion of its 10-K, it is apparent that the company currently possesses a highly competitive position and progressive management strategy. Starbucks’ top position in its industry and management strategy comes from the fact that this company has multiple areas of strength and lacks overwhelming weaknesses. Strengths and weaknesses with regard to a firm like Starbucks are based on the internal factors relating to a company. The internal analysis of Starbucks shows that it enjoys much strength as a company. When analyzing the strategic management of a company, a strength is defined as a firm’s “resources and capabilities that can be used as a basis for developing a competitive advantage” (QuickMBA). The “Management Discussion and Analysis” section of the Starbucks Annual Report features many strengths according to this definition. Starbucks’ capabilities go way beyond simply selling coffee at Starbucks shops in America. In fiscal 2012, Starbucks experienced a 7 percent growth in global store sales, 50 percent increase in “Channel Development,” and 20 percent raise in licensed stores revenue (SBUX 2012 Annual Report, 25). This fact alone presents multiple strengths Starbucks has. Starbucks has stores and a positive presence implanted in multiple countries divided into the three sectors of the Americas, “EMEA” (Europe, Middle East, and Africa), and “CAP” (China/Asia Pacific). Additionally, Starbucks maintains the operating segment of “Channel Development” which focuses on the sale of Starbucks and Tazo branded K-Cups and other beverage innovations. As stated before, this segment of Starbucks’ operations witnessed a 50 percent increase in revenues in fiscal 2012 which shows how strong Starbucks as a firm really is. On top of these optimistic facts, Starbucks simply continues to show its strength with regard to its market dominance and brand-name recognition throughout America and other...
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