The PESTLE analysis will be used to identify and understand the important factors Starbucks must consider in all areas of the business. Political:
Taxation Policy: Increase in the taxation on farmers in different countries producing coffee beans would have an impact on the pricing of Starbucks. International Trade Tariffs: Since Starbucks operates in 49 countries therefore, there are lots of items that the company imports and exports in different regions of the world and when the government of any of these 49 countries impose a tariff it would affect the performance of the company. Government Stability: the stability of the government is an important factor for a company’s performance like Starbucks that is operating in 49 countries. International Stability: after the 9/11 the international stability has been affected and more issues like these can badly hurt Starbucks. Employment law: many governments have raised concern regarding the minimum wage that a company has to pay and this could also the influence the profitability of the company.
Economic: Interest rates: As the company is operating in 49 countries therefore it is important for Starbucks to consider the interest rate of the country before making the investment and expansion decision. Also interest rate will have an influence on the consumers as well. Economic Growth: If any of the country where the growth is slow then the performance of Starbucks will also be influenced. Recession: With the current economy going through the period of recession, this could also affect the sales of coffees in different parts of the world. Competitors pricing: Different cafes, restaurants have been opened and providing coffees to their customers, therefore the pricing of these competing companies is also an important factor. Exchange rates – Exchange rates also affects Starbucks when they are dealing with international trade. Inflation
References: Map, Starbucks, 2010. Starbucks Coffee Company. http://www.spatialdatabox.com/mapdemos/starbucks-map.html. Retrieved 2010-04-29. BBC News, 2004. " Store Wars: Cappuccino Kings". Malone, Michael, 2005. "Fightin ' Words". Restaurant Business. http://www.williams.edu/go/native/names.htm. NYT, 1999. McDonalds Corp Betting That Coffee Is Britains Cup of Tea". New York Times. http://www.nytimes.com/1999/03/28/world/mcdonald-s-corp-betting-that-coffeeis-britain-s-cup-of-tea.html. Retrieved 2009-08-06. Warner, Melanie, 2004. "Cup of Coffee, Grain of Salt". New York Times. http://query.nytimes.com/gst/fullpage.html?res=950CEFDA1E30F935A15751C1A9629 C8B63. Image, n.d. Retrieved June 28, 2010 from http://www.vectorstudy.com/management_theories/porters_five_forces.htm 13