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Business Analysis
Compiled By;
Qamarudheen Thayyil
khamarudheent@gmail.com
+919-6259-234-12
STARBUCKS
COFFEE
www.starbucks...
Intrduction
Overview
Histrory
Mission
Key People
I
n
t
r
d
u
c
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o
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Overview
Starbucks is a world renowned specialty coffee
maker.
It roasts, markets and retails specia...
I
n
t
r
d
u
c
t
i
o
n
It also market some products under brands such
as Tazo Tea, Seattle’s Best Coffee, Starbucks VIA,
To...
I
n
t
r
d
u
c
t
i
o
n
The first Starbucks store opened in Seattle’s
Pike Place Market in 1971.
The company grew to be the ...
I
n
t
r
d
u
c
t
i
o
n
Schultz wanted to bring the Italian café culture
to the United States. Selling espresso by the cup
w...
I
n
t
r
d
u
c
t
i
o
n
Starbucks coffee on United Airlines flights.
Selling premium teas via Tazo Tea Company.
Offering ord...
“To inspire and nurture the human spirit one
person, one cup, and one neighborhood at a time.”
It ethically sources the fi...
I
n
t
r
d
u
c
t
i
o
n
9
Key People
Howard Schultz
Chairman
President
Chief Executive Officer
Troy Alstead
Chief Financial ...
PRODUCTS
Drinks
Food
Merchandise
P
R
O
D
U
C
T
S
Espresso
®
FrappussinoNon-Coffee
Cappuccino
11
Drinks
Pastry/ Cakes
CookiesMuffins
Sandwitch
P
R
O
D
U
C
T
S
12
Food
P
R
O
D
U
C
T
S
13
Merchandise
Blends
Coffe MakersMugs
Tumblers
SWOT Analysis
Strengths
Weaknesses
Opportunities
Threats
Innovation
Global presence
Strong financials
Brand identity
Store ambience
15
Strengths
S
W
O
T
A
n
a
l
y
s
i
s
High employee turnover
Over dependence on US market
Small product mix
Higher prices
Too many products
16
Weaknesses
S
W
O
...
S
W
O
T
A
n
a
l
y
s
i
s
International markets
Customization
Inorganic growth
New product mix
Localization
17
Opportunities
Intense competition
Govt. Regulations
Uncertain suppliers
Target of terrorism
Saturated US market
S
W
O
T
A
n
a
l
y
s
i
s
...
Strategy
Success Formula
Internalization
S
T
R
A
T
E
G
Y
Motivated employees & superior customer
service is the key success factor of Starbucks.
Starbucks focuses
...
S
T
R
A
T
E
G
Y
21
Market Entry
Local joint-venture is the preferred
entry strategy of Starbucks.
Financial Analysis
Share Price
Sales Mix
Income Statement
Earnings
Balance Sheet
F
I
N
A
N
C
I
A
L
S
$46.50
$56.55
$62.00
$54.28 $54.90
$58.97
$67.48
$77.84
$35.12
$45.28
$51.03
$43.04 $44.27
$52.39
$56....
F
I
N
A
N
C
I
A
L
S
74% 75% 75%
20% 19% 19%
3% 4% 4%3% 2% 2%
2013 2012 2011
Beverages Food Packaged and single serve coffe...
F
I
N
A
N
C
I
A
L
S
14892.2
13299.5
11700.4
15469
11512.8
10175.8
-325.4
1197.4
1728.5
8.3
1384.7 1248
2013 2012 2011
Net ...
F
I
N
A
N
C
I
A
L
S$0.01
$1.83
$1.66
$0.89
$0.72
$0.56
2013 2012 2011
EPS Cash Dividends
26
Earnings
F
I
N
A
N
C
I
A
L
S
$5,471.40
$4,199.60
$6,045.30
$4,019.60
$5,377.30
$2,209.80
$1,657.10
$894.90
$4,482.30
$5,114.50
2013...
MARKETING
Segment
Targeting
Positioning
Product
Price
Place
Promotion
M
A
R
K
E
T
I
N
G
Every age group.
Tech savvy individuals.
Men and women.
High disposable income.
Brand focused.
Savvy and...
M
A
R
K
E
T
I
N
G
Starbucks targets commuters and captive
consumers.
Commuters consist of people heading to or from
work o...
M
A
R
K
E
T
I
N
G
Starbucks has positioned itself as an upscale
brand which provide rich experience.
It is obvious from th...
M
A
R
K
E
T
I
N
G
Coffee: More than 30 blends and premium coffees.
Handcrafted Beverages: Fresh-brewed coffee,
®
hot and i...
M
A
R
K
E
T
I
N
G
Startbucks offers all of its products at a premium
price.
Prices range from $1.00-$4.20 for drinks which...
M
A
R
K
E
T
I
N
G
Distributed directly to customers through own
retail stores and retail partners.
Located in high-traffic...
M
A
R
K
E
T
I
N
G
Advertising
Starbucks spends under 3% of revenue on ads.
But spends more on ensuring customer
satisfacti...
FACTS
Five Facts
F
A
C
T
S
37
Five Facts
Starbucks has added an average 15 stores on a daily
basis since 1987.
The average Starbucks custom...
Recognitions
Awards
R
e
c
o
g
n
i
t
i
o
n
s
“No. 1 Best Coffee,” Fast Food and Quick
Refreshment categories Zagat’s Survey of
National Chain R...
Compiled By;
Qamarudheen Thayyil
khamarudheent@gmail.com
+919-6259-234-12
THANKS
www.starbucks.com
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Starbucks

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Transcript of "Starbucks"

  1. 1. Business Analysis Compiled By; Qamarudheen Thayyil khamarudheent@gmail.com +919-6259-234-12 STARBUCKS COFFEE www.starbucks.com
  2. 2. Intrduction Overview Histrory Mission Key People
  3. 3. I n t r d u c t i o n Overview Starbucks is a world renowned specialty coffee maker. It roasts, markets and retails specialty coffee. It offers blends of coffee, handcrafted beverages, merchandise, and food items, ready-made drinks, and Starbucks ice cream. It markets all of its products under the flagship Starbucks brand. 3
  4. 4. I n t r d u c t i o n It also market some products under brands such as Tazo Tea, Seattle’s Best Coffee, Starbucks VIA, Torrefazione, Italia Coffee, and Evolution Fresh. The company-owned and licensed stores operates across Asia-Pacific, the Middle East, Africa, Europe and the Americas. Total stores: 19767 (as of September 29, 2013) Company-operated - 10194. Licensed stores - 9573. Overview 4
  5. 5. I n t r d u c t i o n The first Starbucks store opened in Seattle’s Pike Place Market in 1971. The company grew to be the largest roaster in Washington with multiple locations until the early 1980’s. In 1981,Howard Schultz, recognized a great opportunity and began working with the founder Jerry Baldwin. History 5
  6. 6. I n t r d u c t i o n Schultz wanted to bring the Italian café culture to the United States. Selling espresso by the cup was the first test. Schultz left Baldwin to open his own and raised money from investors to purchase the Italian Coffee House Giornale. The company experienced rapid growth going public in 1992, and growing tenfold by 1997, with locations around the United States, Japan and Singapore. History 6
  7. 7. I n t r d u c t i o n Starbucks coffee on United Airlines flights. Selling premium teas via Tazo Tea Company. Offering order Starbucks coffee online. Introduced new products and operations. Today, Starbucks has millions of customers every day, in about 19,000 locations in over 62 countries which have employed approximately 1,82,000 partners worldwide. Starbucks also began expanding its brand by; History 7
  8. 8. “To inspire and nurture the human spirit one person, one cup, and one neighborhood at a time.” It ethically sources the finest coffee beans. It embraces diversity. It provides a human connection with employees. It creates stores where customers feel comfortable. It takes responsibility in each community. I n t r d u c t i o n 8 Mission
  9. 9. I n t r d u c t i o n 9 Key People Howard Schultz Chairman President Chief Executive Officer Troy Alstead Chief Financial Officer and Group President, Global Business Services Adam Brotman Executive Vice President, Chief Digital Officer Curtis Garner Executive Vice President, Chief Information Officer Sharon Rothstein Executive Vice President, Global Chief Marketing Officer Arthur Rubinfeld Chief Creative Officer, President, Global Innovation And Matthew Ryan Executive Vice President, Global Chief Strategy Officer
  10. 10. PRODUCTS Drinks Food Merchandise
  11. 11. P R O D U C T S Espresso ® FrappussinoNon-Coffee Cappuccino 11 Drinks
  12. 12. Pastry/ Cakes CookiesMuffins Sandwitch P R O D U C T S 12 Food
  13. 13. P R O D U C T S 13 Merchandise Blends Coffe MakersMugs Tumblers
  14. 14. SWOT Analysis Strengths Weaknesses Opportunities Threats
  15. 15. Innovation Global presence Strong financials Brand identity Store ambience 15 Strengths S W O T A n a l y s i s
  16. 16. High employee turnover Over dependence on US market Small product mix Higher prices Too many products 16 Weaknesses S W O T A n a l y s i s
  17. 17. S W O T A n a l y s i s International markets Customization Inorganic growth New product mix Localization 17 Opportunities
  18. 18. Intense competition Govt. Regulations Uncertain suppliers Target of terrorism Saturated US market S W O T A n a l y s i s 18 Threats
  19. 19. Strategy Success Formula Internalization
  20. 20. S T R A T E G Y Motivated employees & superior customer service is the key success factor of Starbucks. Starbucks focuses on recruiting and developing right people. Starbucks partner serving coffee with a smile :) 20 Success Formula Attractive compensation policies.
  21. 21. S T R A T E G Y 21 Market Entry Local joint-venture is the preferred entry strategy of Starbucks.
  22. 22. Financial Analysis Share Price Sales Mix Income Statement Earnings Balance Sheet
  23. 23. F I N A N C I A L S $46.50 $56.55 $62.00 $54.28 $54.90 $58.97 $67.48 $77.84 $35.12 $45.28 $51.03 $43.04 $44.27 $52.39 $56.65 $65.82 12Q1 12Q2 12Q3 12Q4 13Q1 13Q2 13Q3 13Q4 High Low 23 Share Price
  24. 24. F I N A N C I A L S 74% 75% 75% 20% 19% 19% 3% 4% 4%3% 2% 2% 2013 2012 2011 Beverages Food Packaged and single serve coffees Coffee-making equipment and other merchandise 24 Sale Mix
  25. 25. F I N A N C I A L S 14892.2 13299.5 11700.4 15469 11512.8 10175.8 -325.4 1197.4 1728.5 8.3 1384.7 1248 2013 2012 2011 Net Revenue Operating Expense Operating Income Earnings After Interest & Tax 25 Income Statement
  26. 26. F I N A N C I A L S$0.01 $1.83 $1.66 $0.89 $0.72 $0.56 2013 2012 2011 EPS Cash Dividends 26 Earnings
  27. 27. F I N A N C I A L S $5,471.40 $4,199.60 $6,045.30 $4,019.60 $5,377.30 $2,209.80 $1,657.10 $894.90 $4,482.30 $5,114.50 2013 2012 Current Assets Fixed Assets Current Liabilities Long Term Liabilities Equity 27 Balance Sheet
  28. 28. MARKETING Segment Targeting Positioning Product Price Place Promotion
  29. 29. M A R K E T I N G Every age group. Tech savvy individuals. Men and women. High disposable income. Brand focused. Savvy and avid coffee lovers who enjoy the “Starbucks Experience”. 29 Segment
  30. 30. M A R K E T I N G Starbucks targets commuters and captive consumers. Commuters consist of people heading to or from work or people on their lunch break. Captive consumers consist of those who are stuck in a campus environment. Eg: high school & college students, corporate campuses. 30 Target Customer
  31. 31. M A R K E T I N G Starbucks has positioned itself as an upscale brand which provide rich experience. It is obvious from the mission statement that they are trying to make it the best for socializing. Starbucks is trying to reposition itself as a “third place” for its customers. 31 Positioning
  32. 32. M A R K E T I N G Coffee: More than 30 blends and premium coffees. Handcrafted Beverages: Fresh-brewed coffee, ® hot and iced espresso beverages, Frappuccino coffee and non-coffee blended beverages, ® smoothies and Tazo teas. Fresh Food: Baked pastries, sandwiches, salads, oatmeal, yogurt parfaits and fruit cups. Merchandise: Coffee- and tea-brewing equipment, mugs and accessories, packaged goods, music, books and gifts. 32 Product
  33. 33. M A R K E T I N G Startbucks offers all of its products at a premium price. Prices range from $1.00-$4.20 for drinks which is higher than any other retailers. In case of foods, Starbucks is more expensive when compared to quick-service restaurants, 33 Price
  34. 34. M A R K E T I N G Distributed directly to customers through own retail stores and retail partners. Located in high-traffic, high-visibility locations, focusing on pedestrian consumers. Company also focus on drive-thru retail stores for the convenience of non-pedestrian consumers. 34 Place
  35. 35. M A R K E T I N G Advertising Starbucks spends under 3% of revenue on ads. But spends more on ensuring customer satisfaction to increase word of mouth. Personal Selling Public Relations Sales Promotions Passionate employees, customer satisfaction. Events, public performances, green initiatives philanthropic endeavors. Store decoration, viral videos, sample vans, billboards, newspaper, magazines and social media. 35 Promotion
  36. 36. FACTS Five Facts
  37. 37. F A C T S 37 Five Facts Starbucks has added an average 15 stores on a daily basis since 1987. The average Starbucks customer visits the store 6 times per month while loyal 20% of customers visit 16 times. There are over 87000 drink combinations at Starbucks. The Starbucks cinnamon chip scone has more calories than a McDonald’s quarter pounder with 480 calories. Starbucks uses 93 million gallons of milk and 2.3 billion paper cups per year. 1 2 3 4 5
  38. 38. Recognitions Awards
  39. 39. R e c o g n i t i o n s “No. 1 Best Coffee,” Fast Food and Quick Refreshment categories Zagat’s Survey of National Chain Restaurants – 2009-2010 “No. 1 Most Popular Quick Refreshment Chain” Zagat’s Survey of National Chain Restaurants – 2009-2010 One of the “World’s Most Ethical Companies” Ethisphere – 2007-2010 39 Awards One of “The 100 Best Companies to Work For” FORTUNE – 1998–2000, 2002–2010 One of the “Most Admired Companies in America” FORTUNE – 2003–2010 One of the “Global 100 Most Sustainable Corporations in the World” Corporate Knights – 2010
  40. 40. Compiled By; Qamarudheen Thayyil khamarudheent@gmail.com +919-6259-234-12 THANKS www.starbucks.com
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