Case study on starbucks
Case Background: Starbucks is USA based coffee roaster & retailer worldwide. They came up with the revolutionary idea of selling whole coffee beans. In 1987, Howard Schultz acquired the company and came up with delivering the coffee in cup and some espresso beverages. Starbucks enhances to give premium standard of coffee by buying the rigorous standard coffee by using Arabica coffee beans irrespective of their price. Starbucks wants to become the most respected coffee brand in the world by increasing its market shares. Starbucks has more than 9000 outlets in around 28 countries and now trying to expand the market in Asia. Starbucks was expanding rapidly as the average was as high as 4 stores per day in 2004. Starbucks is now the leading coffee industry in American market. There sales growth in the American market is rapid but the rate is slowing. There were number of strengths and issues faced while expanding in the Asian market. The case enhances students to know the problems faced in different market with different culture. We will study and analyze them with the help of SWOT analysis.
Case Issues:
Starbucks overall performance was always raising but there were some issues which affected its rate which should be noticed.
Starbucks is cannibalizing its own stores which are impacting the customer base. Starting with 17 outlets Starbucks now have more than 10000 outlets which also have resulted in shutting down some stores.
Starbucks aim was to increase the market share but it affected in competition with its own outlets. This problem caused the slow growth rate of annual sales.
Starbucks have a high standard in delivering the fresh coffee. Even after entering the Asian market in 1996, Starbucks still don’t have a roasting plant in Asia affecting its operating cost.
Operating the outlets fully owned than venturing with the other local companies reduces the revenue as well as makes the risk that partner becomes the future competitor.
Annual growth
Case Issues:
Starbucks overall performance was always raising but there were some issues which affected its rate which should be noticed.
Starbucks is cannibalizing its own stores which are impacting the customer base. Starting with 17 outlets Starbucks now have more than 10000 outlets which also have resulted in shutting down some stores.
Starbucks aim was to increase the market share but it affected in competition with its own outlets. This problem caused the slow growth rate of annual sales.
Starbucks have a high standard in delivering the fresh coffee. Even after entering the Asian market in 1996, Starbucks still don’t have a roasting plant in Asia affecting its operating cost.
Operating the outlets fully owned than venturing with the other local companies reduces the revenue as well as makes the risk that partner becomes the future competitor.
Annual growth
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