Swot About Starbucks

Topics: Starbucks, Coffee, Espresso Pages: 6 (1569 words) Published: August 17, 2010

1. Introduction2

2. SWOT analysis2

2.1. Strengths3

2.2. Weaknessed3

2.3. Opportunities4

2.4. Threats5

Figure 1: SWOT Matrix6

3. Conclusion…………..6


1. Introduction

Starbucks Corporation is an international leader in bringing coffee and the coffeehouse experience. As the company grew from a single store in Seattle, USA (1971) to thousands of stores worldwide, it has kept its mission statement clear and concise: “To inspire and nurture the human spirit- one person, one cup, and one neighborhood at a time” (Starbucks, 2009). It is their enthusiasm, high-quality coffee and exotic tea and good business sense that help them create the Starbucks of history. Starbucks is not just to please the mass market appeal, but to provide high-quality services. In Starbucks comfortable environment, customers can sit down and relax with special jazz and blue CDs while enjoying a wide choice of coffees such as fresh brewed coffees, different Italian-style espresso drinks, cold blended beverages (Frappuccino), packaged roasted whole bean coffees, or Via Ready Brew and Vivanno Smoothies instant coffee with fresh pastries and other food items. Also, the company mainly relies on word of mouth, so that more and more people have been coming into their stores. Product prices will not always be very high, and this is one of the reasons that Starbucks has been attracting so many customers for decades.

2. SWOT Analysis

SWOT is the acronym for Strengths, Weaknesses, Opportunities and Threats. In paticular,

▪ Strengths: attributes of the person or company that are helpful to achieving the objective(s).

▪ Weaknesses: attributes of the person or company that are harmful to achieving the objective(s). ▪ Opportunities: external conditions that are helpful to achieving the objective(s). ▪ Threats: external conditions which could do damage to the objective(s). Identification of SWOTs are essential because subsequent steps in the process of planning for achievement of the selected objective may be derived from the SWOTs. Therefore, the aim of this paper is to do an in-depth SWOT analysis of Starbucks Corporation in order to identify the key internal and external factors that are important to its successful operation.

1. Strengths

To begin with Strengths, Starbucks’ reputation with high brand equity can not be denied. Starbucks is one of the most well-recognizable brand name with high brand loyalty, perceived quality for fine products and services., and strong brand associations. With almost 9000 cafes and 16000 coffee shops in almost 40 countries world-wide, Starbucks Corporation is a very profitable organization, earning in excess of $600 million in 2004.

The company also care about the concept of environment which is mentioned in the mission statement as well. The internal environment that Starbucks tries to create in its stores is a comfortable place where a customer “can sit for five hours with a single cup of coffee’.

Relationship with employees is also important asset for the success of Starbucks. Howard Schultz, the Chairman of Starbucks wrote that to gain profit and be competitive, famous brand and respect employees, both are necessary (Barbara Farfan). Starbucks not only has excellent training program, but through effective encouragement policies, it also creates open communication between employees and managers. As all employees have options, they were also called "partners". The headquarters of the company is even named "Starbucks support center" whereas management center of information and support functions are provided to the grassroots shops instead.

2. Weaknesses

Although widely known to be successful, the company does have some weaknesses. The first one is its extremely high in pricing. Because it is too expensive, it is easy for customers to switch from drinking Starbucks coffee to...
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