The Coffee Industry Analysis

Topics: Coffee, Starbucks, Coffeehouse Pages: 5 (1799 words) Published: October 31, 2010
The Coffee Industry Analysis
The gourmet coffee industry has continued to grow for the Great Cups of Coffee company since it began in the year 1997. It seems that gourmet coffee has become in great demand for the American workforce and for people who love it. Coffee shops can serve as place to relax, read, socialize, work and study. Some coffee shops even provide wireless hot spots. The current trend seems to be spending five dollars on a cup of gourmet coffee. Some coffeehouse competitors of Great Cups of Coffee Company are Starbucks, Panera Bread, Dunkin Donuts and McDonalds. Some of the competitors have more employees to contend with. According to the McDonalds website, “The Company has 1.6 million employees.” (, 2009) Now according to Hoover’s website, “The Company Panera Bread has 7800 employees.” ( Retaining employees can be a growing concern for the coffee house industry. The Great Cups of Coffee Company seems to have a large turnover rate, as well as other coffee shops. One may ask how do you retain and attract employees, even the part-time employees. This could stem from the benefits and compensation each company offers. For instance Starbucks offers incentive plans and benefits to their part-time employees. As stated by Starbucks, “Total Pay (Compensation, Stock, Benefits and Savings) Starbuck Total Pay package is referred as “Your Special Blend” because it is unique to each partner.” (, 2009) What the company offers is benefits to employees who work 20 to 40 hours a week. Great Cups of Coffee should seriously consider offering benefits to part-time employees starting with some form of health insurance, since health care is so expensive. Other benefits the company could offer would be assistance for college for younger employees and a retirement plan for all to contribute to. Employees would be more likely to stay with the company, if benefits were available. The company might consider a job analysis to find out what needs measured. For instance what drivers are involved, what motives the employees, what attitudes do employees have, and are employees satisfied. This can be done by completing a satisfaction survey; current employees could guide management in making changes for the better. It is a known fact that satisfied employees who feel like their opinions matter will stay with a company longer. Offering regular training will improve the quality of the employee’s work and make him or her feel better about their job. Training and development can be a very important factor for any coffeehouse, as indicated by other companies. According to Espresso 101, “Your employees will be making all of your beverages and food items. You must hire people who share the same passion for quality that you as an owner have, not only for your espresso and coffee beverages, but for every menu item you serve. ( 2009) With improved training customer service will improve; customer service is the key to any successful business. Our book states, “Revenue growth ultimately derives from increased customer satisfaction, which in turn is boosted by product innovation and reliable delivery schedules, among other things.” (The HR Scorecard, 2001) With any food oriented business, staffing can be a difficult task. In order for GC3 to hire the cream of the crop employees, it will need to offer competitive benefits, as well as the possibility for advancement within the company. Particular issues with GC3 seem to be that the pay is not competitive and that the number of staff in each store could be considered inadequate. By adding additional part-timers customer service will improve. A manager and two shift managers should be sufficient for the hours of operation, so that more monies can be devoted to the part-time employees. Also, with what GC3 is currently paying, they should tap the high school market and hope that when these employees are mature they will come back as managers....
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