Starbucks’ Mission Statement“Establish Starbucks as the premier purveyor of the finest coffee in the world while maintaining our uncompromising principles while we grow.” -2008 "To inspire and nurture the human spirit - Oneperson, One cup, and One Neighborhood at a time.“ - 2012
IntroductionResearch was conducted into Starbucks to find out if a new store in Sweden would be feasible. There were three main objectives: 1) The external environment will be explored 2) The internal environment will be investigated 3) Based on the findings in objectives (1) & (2), recommendations were made.
Countries that have Starbucks stores are shown above in green.
The Focus Group FindingsAttendees Drink Coffee in a Café Already has Espresso House Swedish Culture to drink in Café Pre-made and packaged goods no “home made” productsSee Starbucks as “fast” & “quick” Change menu to suit Swedish coffee cultureDisagree with mission statement – Would purchase Starbucks from not a “third place” Ireland Believe that they will be American – Very pop culture successful Target Students/Tourists Fair Trade – No impact in Sweden
The Survey Findings 56% Female, 44% Male Little Loyalty to a Coffee BrandAll participants were Swedish Swedish People Will Buy from StarbucksMajority Aged between 16-24 Gevelia is considered the most popular brand of coffeeMost drink at least one cup of Majority think Starbucks entering Coffee a day Sweden is a good idea.Most Drink Their Beverage At Participants believe Starbucks will Home be most successful in Stockholm
PESTEL Analysis Political Factors Economic Factors Social Factors 1. Swedish Banks are 1. High Average life1. Increase of extremely stable expectancy business participation 2. Unemployment rate 2. English is widely2. Strong Existing of 7.6% in Jan 2012 spoken Relationships 3. Sweden is an 3. Aging3. Subject to EU export-dependant population, decli Regulations country ning birthrate
PESTEL Analysis Legal FactorsTechnology Factors Environmental Factors 1. Strong 1. Foreign investments1. Leading position in are strongly R& D international environmental encouraged2. High level of image 2. No stated minimum innovators 2. Taxes on waste wage3. New management 3. Trade unions are developments in 3. Anti-litter laws, & extremely strong in technologies other EU legislation Sweden
Buyer Power: Supplier Power:Buyer power within the Swedish hot drinks market is moderate Supplier power is moderate, however depends on the size of the company PORTER’S Substitutes:FIVE FORCES Threat of substitutes is very low in Sweden New Entrance: Rivalry: The overall rivalry due to the culturalThe Threat of new entrants is aspect in Sweden is strong moderate
Product Offers a variety of beverages – not just coffee! Known for its coffee variety, includes more than 30 blends of coffee.Offers seasonal & holiday beverages e.g. “Pumpkin Spice Latte” Offers food like pastries, sandwiches & salads.
Price Raised prices by about 1% due to the increasing price of coffee beans, dairy produce and other raw material. Wishes to maintain or lower the price of some of its most popular beverages. Unlike the coffee, tea prices aren’t basedon the size, instead it’s based on the number of tea bags, since water is pretty cheap in non-bottle form.
Place Seen as a gathering place in the neighbourhood.Distributed directly to the customer in the Starbucks Cafes as well as over 3rd parties such as supermarkets. Starbucks cafes are found (as well as in the city centre locations) in major industrial parks with a large labour appearance.
Promotion Starbucks started a community website, My Starbucks Idea,designed to collect suggestions and feedback from customers. Starbucks stresses quality above price and other features it could emphasize.Has gone to great lengths to create a “community atmosphere” among premium coffee lovers. The Starbucks Card.
People Starbucks customers are service orientated.Starbucks is committed to the principle of equal employment opportunity The staff at Starbucks are friendly, helpful and polite.All employment decisions at Starbucks are based on business needs, job requirements and individual qualifications.
ProcessStarbucks offers an experience like no other coffee house. The process is: entering the store, queuing to pay, and then waiting for your order at another counter. The customers can choose to drink in or take out.The process that Starbucks have in place is not always the best.
The Starbucks Process(1) Queue To Order Your Drink (2) Order & Pay For Your Drink(3) Wait For Drink To Be Made (4) Enjoy Your Starbucks
Physical EvidenceStarbucks staff wear black trousers, a black polo shirt and a green Starbucks apron. Coffee-master = black apron. The Merchandise all have the Starbucks logo. Loyalty Card.
Strengths Weaknesses Organisational culture is very strong. Increased number of competitors. Excellent value network. Refuses to guarantee that products are free of genetically modified ingredients. Strong recognised global branding. Increases in pricing are not in line with Good corporate social responsibility. global economic crises.Incentives to progress through company. Management structure is hierarchical and decision making is very slow. Good reputation around the world. No cultural differences considered. World’s Most Ethical Company in 2012
Opportunities ThreatsAdvertising environmentally friendly Global Economic Crisis. policies. Increased waste produced. Advertising local charity drives. Small businesses being pushed out of the marketClose working relationships with trade Huge resistance in international unions. countries. Job Creation. People are becoming more health conscious. Niche Market – “Coffee-on-the-go” Huge coffee culture exists - a great number of competitors.