Starbucks Essay

342 Words2 Pages
1. What are the four dimensions of ‘distance’ in Starbucks’ international expansion? Cultural distance, Administative distance, geographic distance and economic distance. 2. How did Starbucks reduce the ‘distance’ vis-á-vis host countries? Starbucks has used various tactics to reduce its distance from foreign markets. To reduce cultural distance, Starbucks has conducted extensive research in each country, using focus groups and quantitative analysis, to evaluate local cultural sensitivities and preferences. To reduce economic distance, Starbucks has expanded primarily into developed countries. In developing countries, it has focused on major cities first and only later expanded into smaller cities when confident that the smaller cities had consumers with the necessary disposable income. This last point also reduced the geographic distance. 3. Looking only at the four dimensions of distance, should Starbucks invest in Japan or China? If yes, give the reasons why; if no, why not? Yes, it could be a success. China and Japan are big markets, however Starbucks should take into consideration that these cultures are not particularly coffee drinking cultures. Another problem is that there is an economic distance. $4,90 is normal for a coffee in America, however this could be very expensive in other countries like China. 4. If you had been in charge of the international expansion of Starbucks, what would you have changed ( e.g. the pace, the choice of host countries )? We would have be more careful in expanding internationally. When a country appears to be interesting, Starbucks should have acted faster. Immediately set up research and after that enter the market instead of waiting until other ‘copies’ of starbucks occur and you’ll be in a lawsuit first. 5. Can you provide an update on Starbucks’ international expansion, using materials
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