International entry strategy Entry to new markets in many countries is key factor that makes a firm be able to expand its business and target market to further sales and growth. Like others, Starbucks, which is recognized the largest coffeehouse chain, operates its stores in the U.S. and more than 50 countries around the world to accomplish the vision which is to establish Starbucks as the most recognized and respected brand in the world (Starbucks.com). Therefore, one strategy that Starbucks focusing on is extensively expanding abroad. However, this company emphasizes on implementing the idea of partnership first. In other word, it focuses on the companies goals not the countries goals. Thus, Starbucks expands its business to other markets outside The U.S. by using two expansion strategies which are joint venture and licensing arrangement to gain the easier access to new markets.
Joint venture The first method Starbucks using to enter foreign markets is joint venture which is a new corporate entity created and jointly owned by two or more parent companies (Peng, P.339). The reason why Starbucks does joint venture with new markets is because it protects the sustainable competitive advantage, shares resources, reduces in the financial risk incurred by the firm, access to markets, and benefits through local adaptation. The example of joint venture of Starbucks is Japan which is the first developed market outside the U.S. and significant to Starbucks ' global plan because this country is the third largest coffee consuming nation in the world, behind the U.S. and Germany (Gourmet-coffee-zone.com). Starbucks Coffee Japan