872212751 Yi-Chi Lin MKTG 4380 Case Analysis of Starbucks Corporation Question 1: Why did Starbucks partner with Conservation International to develop C.A.F.E (Coffee And Farmers Equity Practices)? Since 2005, Starbucks has been the world’s largest specialty coffee retailer and it expanded consistently and saw strong growth in the sales and net profits. In the 1990s, the specialty coffee industry experienced enormous growth, fueled largely by the coffee-drinking habits of college graduates and other educated professionals. However, due to oversupply of lower-grade coffee beans, the prices of coffee beans had depressed and which made it difficult for coffee farmers to earn enough revenue to cover the cost of production. By the end of 2005, Starbucks owned more than 10,000 stores and roasted 2.3 percent of the world’s coffee.
Comparing and Contrasting Starbucks and Tim Hortons The coffee and café industry has begun to boom in the past few decades. Addictions to coffee are growing and more places are opening up to cater to these needs. There are two in particular that compete on a constant basis: Starbucks and Tim Hortons. Both restaurants have their own loyal customers and though they essentially sell the same thing, they are also quite different in some aspects. In this essay, coffee selections, food selections, and interior and design of Starbucks and Tim Hortons will be compared and contrasted.
Monique Webster Capella University December 18, 2011 Introduction to Microeconomics Unit 4 - Assignment 1 Case Study 1 The Coffee Crisis "The Coffee Crisis" Case Summary In the commercial coffee industry, there are two important coffee species - arabica and canephora, more commonly called robusta. Coffee arabica is descended from the original coffee trees discovered in Ethiopia. These trees produce a fine, mild, aromatic coffee and represent approximately 70 percent of the world's coffee production. On the world market, arabica coffees bring the highest prices. The better arabicas are high grown coffees generally grown between 2,000 to 6,000 feet above sea level though optimal altitude varies with proximity to the equator.
(1)value-creative The Starbucks once declare its ultimate goal is to open 25000 branches in the world just like the 30000 branches of McDonalds. It can’t be denied it has this confidence for its product quality and rich human resource support. Product quality The Starbucks has devoted itself into operating the best roasted coffee beans。After transformation, the Starbucks has established special procurement system and purchased the best coffee beans in the world so that the people who are fond of Starbucks can taste the purest coffee. In order to guarantee the quality, the Starbucks insists the four principles: it declines the franchise for that it does not believe the franchises can care quality management; it does not allow to sell artificial coffee beans and use chemical essence to pollute the best coffee beans; it declines to enter the supermarkets and
Timeframe- Immediately with monthly milestone follow-ups Action plan Goal: Increase turnover by 30% Build market loyalty towards ‘tweens’ customers Increase efficiencies Actions: • Introducing 20 new products including a range of 6 ‘health’ lollies that have added nutrients. Each sales staff are to promote to customers during sales, our new products. Including the promotion of our healthy alternative range. Timing: 12mths Milestone 4 weekly • Designing new packaging specifically designed to have greater appeal to the 7-12 age group. Sales staff are to promote to younger customers recommending our new range of packaging during purchasers.
| Strengths | Weaknesses | | 1) Strong name branding (logo) rating. The golden arches are known around the world.2) Hamburger University - more than 5,000 attendees per year, and the courses are taught in 28 languages.3) Strong Global presence and Brand recognition4) Introduction of new products5) Largest market share in the fast food industry, and a newly introduced niche into the coffee industry.6) Large number of drive through restraints that offer consumers a quick convenience option. | 1) Starbucks has the larger consumer base of those who have a secondary degree.2) Menu options with poor nutritional value lead to constant media attack: Media focus on poor nutrition3) Poor customer service4) McDonalds Company is based out of the U.S., and the U.S. dollar is low making expansion in the U.S. less profitable.5) High employee turnover rates | Opportunities | S-O Strategies | W-O Strategies | 1) Growing Health Trends among consumers – As of 2009 approximately 57% of consumers were making healthier meal choices, and this number is pretty flat. With the population trending towards low fat, low calorie diets, McDonald’s has endless possibilities to adjust their menu to meet this demand.2) In the 2009 Pew Research Survey – McDonald’s vs. Starbucks it showed that people with a high school degree or less prefer McDonald’s (50% to 26%). Which actually is favorable for McDonalds because the number of high school graduates has decreased again, putting more people into this category.
• Compare to international market, North American consume coffee out of home averagely higher than most of the countries. The values Starbucks provides to its customers are: • Starbucks gives customers a central point to relax, read books and meet friends • It became a gathering place for neighbors • Starbucks being as a third place away from home and work for friends circles and co-workers teams • An experience of uplifted, pleasant and diverse for customers to spent time 2. Starbucks market entry strategy were generally joint ventures and licensing agreements. • From Austria to Taiwan, Starbucks connected locally with best possible partners as joint ventures and they set forward basic strategies expectation from its possible partners. Such as financial solvency, knowledge of local market conditions, prior retail experience, and creative ability.
To examine how the political risks would impact a company, this paper would discuss Starbucks Corporation (“Starbucks”) as an example, as well as the ways that Starbucks can evaluate these risks before entering a new market. Company Background The Starbucks story began in 1971. Back then Starbucks were a roaster and retailer of whole bean and ground coffee, tea and spices with a single store in Seattle’s Pike Place Market. Today, Starbucks is a big multinational coffee and coffeehouse chain / outlet company which is privileged to connect with millions of customers every day with exceptional products and more than 17,000 retail stores in over 55 countries (Starbucks Corporation, 2011). Starbucks purchases and roasts high-quality whole bean coffees and sells them, along with fresh, rich-brewed coffees, Italian-style espresso beverages, cold blended beverages, a variety of complementary food items, a selection of premium teas, and beverage-related accessories and equipment, primarily through company-operated retail stores.
In the 1990s global sales of coffee leapt from $30 bn to $50 bn. (Although, we should note, the money received by growers dropped from $12 bn to $8 bn; see www.oxfam.org.uk.) Coffee contains the stimulant caffeine, which has neurophysiological and cognitive effects, but buying and drinking a cup of coffee happens within a wider social context. The resurgence of coffee shop culture might have major civic, social and interpersonal consequences far beyond just meaning that I can get a nice cup of Java pretty much anywhere I want. DAVE ROBERTS TOM STAFFORD, the winner in the postgraduate category, investigates the coffee break.
He decided to re-create the Italian coffee bar culture in America, to change Starbucks into a place, which makes a great experience, not only a great retail store. Comparing Starbucks positions in 1980s, owning five branches in America, with its current situation, owning 20,891 stores in 63 countries, shows how wise Schultz’s decision had been. The decision to replicate Italian coffee lexicon in America and to combine it with the international expansion of the store. By thinking out of box, Schultz understood that, as a brewery company, they could utilize their potential opportunities and expand their company all over the united states and in the future, all over the world. Shultz not only tried to simulate the atmosphere of an Italian culture house but also inspired by Italian baristas and their skills in making, serving and offering coffee products; later on, he tried to implement this experiences in Starbucks organization culture, especially in training his employees.