What are the attractions and disadvantages of Starbucks Corporation? Presenter: Chi-Che Yuri Liang Instructor: Dr. Pi-Ying Teresa Hsu Date: Nov. 10, 2008
<ul><li>? (26 Mar, 2008). Starbucks Corporation Company Profile. Datamonitor Business Information Company. Retrieved October 13, 2008, from: http://www.datamonitor.com/companies/ company/?pid=E86AFA79-07E1-4115-AA0C-0016416541FE </li></ul>
<ul><li>Wherever we are, we both have an </li></ul><ul><li>important ritual for starting most days. </li></ul><ul><li>We stop in to a Starbucks store for a cup </li></ul><ul><li>of coffee. - Howard Schultz , 2006 Chairman of Starbucks Corporation </li></ul>
Introduction Multi-international Corporation (MNC) Head Office Starbucks Corporation 2401 Utah Avenue South Seattle Washington 98134 USA Argentina, Australia, Brazil, Canada, China, Colombia, Denmark, Egypt, France, Germany, Greece, Hong Kong, Indonesia, Ireland, Israel, Japan, …………50 countries↑
SWOT Analysis a. Intense competition b. Volatile coffee prices c. The Forbidden City controversy a. New markets b. Hear Music Label c. Growing specialty coffee market <ul><li>Threats </li></ul><ul><li>Opportunities </li></ul>a. Weak compliance function b. Narrow product mix c. Low employee productivity a. Strong brand image b. Wealthy financial performance c. Large scale of operations <ul><li>Weaknesses </li></ul><ul><li>Strengths </li></ul>
Strength- Strong brand image The 100 Top Brands 2006-2008 ranking of BusinessWeek and Interbrand an international branding consulting firm. BEST GLOBAL BRANDS (2008). http://www.interbrand.com/best_global_brands.aspx 85 2008 88 2007 91 2006 Rank Ranking year
3,607 3,099 2,576 2005 Brand value ($m) Ranking year 2006 2007 2008 3,879
Strength— Wealthy financial performance 28.6% Net profit (after tax) 28.6% Operating profit (gross profit) 24% Sales revenues [Price (of product) X Quantity Sold] Growth rate Financial Performance The company’s revenues, operating profit and net profit from 2002-2006 Compound Annual Growth Rate (CAGR). http://www.investopedia.com/terms/c/cagr.asp
Company's average CAGR return on equity and investment during 2002-2006 11.3% 15.3% Other industries 18% 19% Starbucks Investment Equity (Stocks) Companies
Strength— Large scale of operations over 146,000 people Employ ees more than 44 million people. Customers per week over 13,000 locations in 39 countries Amount of stores
59.5 Diedrich Coffee 7,787 Starbucks Revenue ($m) Companies 225.3 Green Mountain Coffee Roasters (GMCR ) The revenues of Starbucks and two of its competitors in 2006.
Weakness— Weak compliance function Starbucks has been involved in several legal proceedings. The company violated requirements of the *FLSA( Fair Labor Standards Act), a lawsuit was set from June 2004 to August 2007. *FLSA: a federal labor law of general and nationwide application, including Overtime , Minimum Wages , Child Labor Protections , and the Equal Pay Act . The company violated the California Labor Code by allowing shift supervisors to receive tips, a lawsuit was set from October 2004 to May 2007.
Weakness- Low employee productivity The revenue per employee of Starbucks and other industries in 2006 Net profit($) Diedrich Coffee 84,054 8,299 x 3,870 93,330 Other industries average 53,408 Starbucks Revenue($) Companies
Opportunity— Hear Music Label Starbucks and Concord Music Group, in March 2007. Hear Music record label a. All traditional music retail outlets b. Starbucks locations. a. Improve visibility of Starbucks b. Add stability to its revenues.
Threat— The Forbidden City controversy Negative advertisement in recent months (Report publication Date: 26 Mar, 2008) Be conflicting with the rich Chinese culture of the Forbidden City May create an impression among the public that the company is culturally numb, which would negatively impact its brand image.
My research Topic What will MNC modify to meet the satisfaction of diversified culture in different countries?-Take Starbucks in Taichung City as an example. Participants People who have the experience of drinking Starbucks coffee. Methodology Approximately 300 questionnaire.
<ul><li>Thanks for your attention!! </li></ul>