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STARBUCKS; BEYOND A CUP OF COFFEE
     Management and Organization
          Aykut Berber, PhD

      Sorted by presentation order;
             Evrim Gözener
                Işıl Topal
              İpek İpekliler
Outline of the Presentation;


• History of Starbucks; The company   • Store’s Strategy
is on Spotlight                       • Outsanding Contribution
• Starbucks Offers a Little of        • They grow up so fast… But how?
Everything                            • Site Characteristics
• Italy Issues…                       • Starbucks Organization Chart
• Customer Oriented Strategy of       • Industry and Competitive Analysis
Starbucks Company                     • SWOT Analysis
• Product Diversity                   • Staffing
• Coffee Beans of Starbucks Quality   • The Future
• Beverages                           • Responsibility of Starbucks
• Cup Sizes; Hot&Cold Beverages       • Speculations
• Starbucks Salty                     • Advertising
• Starbucks Desert                    • Recommendations
• Structure of Stores
• Innovation Conduction
• Starbucks Corporate Strategy


                                                                        2
Once upon a time                                         Evolution of
            in Seattle…                                              Starbucks logo;
                                                                     according the
•   Starbucks was opened in 1971 in                                  history,
    Seattle, Washington by Jerry             •The Starbucks siren was topless and had a
    Baldwin (a teacher) and Zev Siegel (a    fully-visible double fish tail.
    teacher) and Gordon Bowker (a            •In the second version, the logo also
    writer).                                 inherited the stars from the Il Giornale logo
•   Howard Schultz, an entrepreneur,         •In the current version, her navel and chest
    joined them in 1982.                     are not visible at all, and only vestiges
•   Mr. Schultz influenced coffee bars in    remain of the fish tails.
    Italy and established the chains of II   •Starbucks has grew from 55 stores in 1989
    Giornale Coffee shops.                   to over approx. 20.000 locations today in 55
•   A few years after, the first owners      countries around the world
    bought of the Peet's Coffee and Tea      •20 Million customers a week
    shop and Starbucks was transferred       •Products sold include;
                                                 Beverages
    to Mr. Schultz.                              Pastries
•   Finally, Starbucks was founded by            Whole coffee beans
    combining two brands; II Giornale            Coffee-related retail items ,such as; Mugs,
    and Starbucks.                               Travel mugs, Coffeé Machines, Thermos
                                                 bottles                               3
Starbucks Offers a Little of Everything
• Customer satisfaction priority is concept of the Starbucks Company
• Products are tasted several times to markets of different countries
• Implementation of customer satisfied; Starbucks card, gift card,
some of stores have cd burning unit.
• Turkish people was welcomed the first store on 2003 in Erenkoy
Istanbul
• Hot sleeve, Starbucks cards
• Today , Starbucks has reached 106 stores in Turkey
• Turkish coffee culture has not been changed
• Starbucks to behave respectfully expanded in Turkey and has
introduce filter coffee culture to Turkish people
• Feeling unique experienced, think indivudially; every customer can
create their own coffee.
                                                               4
Italy Issues…


•   The main reason is
    that the coffeé in Italy
    too good
•   Italians have rejected
    Starbucks Coffeé
•   Italy has very
    complicated coffeé
    market




                               5
Customer Oriented Strategy
            of Starbucks Company

•Starbucks is the first chain of coffee shops found all over the world
•Customers feel free all day with one cup of coffee without disturbing
•To be the "extra place" people frequent after home and work.
•Customer confidence; serving high quality fresh coffee in every
stores around the world.
•To address the five senses
   Tasting; Delicious coffee
   Touching; Comfortable chairs
   Listening; smooth jazz
   Smelling; excellent smells of roasted coffee
   And; nice view in every stores
Various milk options, syrups and they have up 85,000 different drink
combinations so priority of individual needs.
                                                                6
Coffee Beans of Starbucks Quality
                      •Starbucks coffee beans are grown in within an area,
                      located near the equator between the tropic of
                      Cancer and Capricorn
                           Latin America
                           Asia Pasific
Product Diversity          Arabian Peninsula
                              oBrazil
•Productions are
                              oRogusto; sea level, 2% cafein
changed for every             oArabica; Starbucks preffered 1% cafein
season;               •A coffee tree contains 680 grams beans in a year.
   christmas blend   •Starbucks always prefers washed and natural dried
   house blend
                      beans.
   breakfast blend
   French roasted    •A coffee tree averages from 15–30 ft. in height and
   Italian roasted   at least 70 inches of rainfall year.
   Caffee Verona
   Decaf blend
   Kenya by Starbucks
   Sumatra by Starbucks
   Guatemala Antiqua                                                   7
Beverages;          Alternative Espresso-based
                                 Cold Drinks
Espresso –based Drinks           •Caffé Latte with ice
•Caffé Latte                     •Iced Caramel Macchiato
•Cappuccino                      •Iced White Chocolate Mocca
•Caramel Macchiato               •Iced Caffé Americano
•Caffé Mocca                     •Iced Chai Tea Latte
•White Chocolate Mocca           •Orange Juice
•Caffé Americano                 Coffee – based Snowy Cold Drinks
•Espresso                        •Coffee
•Espresso Macchiato              •Java Chip Chocolate
•Espresso Con Panna              •Caramel
Classic Products of Starbucks:   •Espresso
•Coffee of the day               Caramel – based Snowy Cold Drinks
•Caffé Misto                     •Vanilla
•Press Coffé                     •Java Chip Chocolate
•Turkish Coffee                  •Caramel
Other Delicious Alternative      Fruit – based Snowy Cold Drinks
•Premium Hot Chocolate           •Rasberry Black Currant
                                                                8
                                 •Mango Passion Fruit
Cup Sizes; Hot&Cold Beverages


   Name Measurement                           Notes

   Short   8 oz (≈ 237 mL)

   Tall    12 oz (≈ 355 mL)


   Grande 16 oz (≈ 473 mL)                    Italian for Large


           20 oz hot (≈ 591 mL), 24 oz cold
   Venti                                      Italian for twenty
           (≈ 710 mL)


   Trenta 31 oz cold only (≈ 917 mL)          Italian for 9
                                                          thirty
Starbucks Salty                 Starbucks Deserts

                                                           oPeach pie
•Ryan Bread with Turkey
                                                     oProfiterole cake
•Mini whole wheat with cheese
                                                          oMosaic Pie
•Mistic
                                               oBrownie cheesecake
•Vegetable pie
                                oWhite chocolate raspberry cheesecake
•Chicken Sandwich
                                                  oLemon cheesecake
•Fiesta
                                                           oBella vista
•Ham and wheese
                                                         oCarrot Cake
•Three cheese sandwich
                                            oWhole wheat carrot cake
•Ham wrap
                                                        oMosaic Cake
•Vegetable wrap
                                                         oLemon cake
•Sesame bagel with cheese
                                                   oStarbucks brownie
•Cheese crossant and roll
                                                       oDoppio cookie
•Whole wheat puff
                                                        oMisto cookie
•Olive puff
                                                             oBerliner
                                         oCookie of Chocolate walnut
                                                              10
Store Manager

            Structure of Stores
                                                   Assistant Manager
•Every store has equal quality
•Starbucks also serves local beverages and taste
of foods                                                Shift Supervisors
•Stores design and goods are almost look alike
•Some of stores serve wine in Canada and the
States                                           Baristas Baristas Baristas
•Organization Chart of stores are exactly alike
•Starbucks does not franchise operations and
has no plans to franchise in the foreseeable
future
•One Major frenchising around the world;
Turkey, Russia and Meiddle East is connected
Shaya Group Company
•Being a Starbucks employee means; to work a
multi-national / global company
                                                                     11
Innovation Conduction

•Every store has equal quality

•Starbucks also serves local beverages and taste of foods

•Stores design and goods are almost look alike

•Some of stores serve wine in Canada and the States

•Organization Chart of stores are exactly alike

•Starbucks does not franchise operations and has no plans to
franchise in the foreseeable future
                                                               12
A Delicious Idea;
           “Establish Starbucks as the premier purveyor of the
           finest coffee in the world while maintaining our
           uncompromising principles while we grow.”

Starbucks Corporate Strategy
•   Maximize market penetration
•   Provide a relaxing, attractive social atmosphere
•   Offer high-quality products
•   Create a great working environment
•   Achieve profitability



                                                                 13
Store’s Strategy              Outsanding Contribution
•   It is to create a comfortable Third   •   Entrepreneurs make unique
    Place environment like your               contributions to the American
    home (socializing, playing game,
    homeworks, working, discussing            economy:
    place)                                •   Create innovations that
•   Serve customer a customized               improve our quality of life:
    high-quality product and expand
    product range                         •   Entrepreneurs create new jobs:
    (sandwiches,beverages,apple CD        •   Entrepreneurs improve the
    burning)                                  position in global economic
•   Minimize overall expenses by              competition:
    focusing on controllable expenses
•   customer portolio impact service      •   Entrepreneurs reinvest their
    quality (A Class and C Class              newly created wealth in the
    customers)                                community:
•   Customer satisfaction –
    ambience,service,offer
                                                                     14
They grow up so fast… But how?

•   Start with a good business                                       Growth of Starbucks
    concept                                         7000


•   Think big                                       6000

•   Think outside the box                           5000

•   Create a unique expreince
                                 Number of Stores
                                                     4000
•   Keep customers happy                                                                                             6294
                                                     3000
•   Dig deep in the customer’s                                                                                4707

    wallet                                           2000

                                                                                                       2135
•   Good management                                   1000                                      1412
                                                                                        676
                                                             17     55     116   272                                   S1
                                                            0
                                                            1987   1989   1991   1993   1995    1997   1999   2001   2003
                                                                                        Years




                                                                                                              15
Site Characteristics
                                         Since, they have won accounts
• Most stores ranged in size from          with many other companies,
1,000 to 1,500 square feet and were
located in office buildings, downtown                          such as:
and suburban retail centers, airport      •   Westin Hotels
terminals, university campus areas, or    •   Canadian Airlines
busy neighborhood shopping areas
convenient to pedestrian foot traffic.    •   Kraft Foods (to extend into
                                              grocery stores)
• Only a select few were in suburban      •   Hyatt Hotels Corp.
malls. While similar materials and        •   Apple
furnishings were used to keep the         •   Sheraton Hotels (now Starwood
look consistent and expenses                  Hotels)
reasonable, no two stores ended up
                                          •   United Airlines
being exactly alike.
                                          •   Nordstrom
                                          •   Canadian Bookstore Chapter
                                          •   Msnbc                      16
Starbucks Organization Chart
                                              CEO

                                                               President
                           Executive VP,       Executive VP,             Executive VP,          Executive VP,
                              Legal        Supply Chain & Coffee      Partner Resources     Chief Financial Officer
                                                Senior VP,
                                                  Coffee
                                                                 President,
                                                                   Japan
                                                             President, Europe,
•Functional in structure and relatively flat                Middle East, Africa

•Team work, workload share is essential                          President,
                                                              North America
•Basic management style is Laissez Faire                                           VP,
                                                                                Southwest
•Management motivates through reviews                                              VP,
                                                                              South Central
and raises                                                                         VP,
•Work duties are assigned by shift                               President,
                                                                                Northwest

supervisors                                                    International

•Employees are allowed to use initiative                                    United Kingdom

and empowered to make decisions                                                 Australia
•Team Work
                                                                                Thailand
•Employee Training
                                                                                                    17
Industry and Competitive                          SWOT Analysis
           Analysis
                                                                 • Strengths
                                                 o Largest market share in industry
• Competitive Activity                                o Differentiated atmosphere
   oMany companies are in the market and
   competition is fierce
   oCompetitors use location, product mix,                   • Weaknesses
   and store atmosphere differentiation to       o Cought dirtiness and cleaness in
   establish market niche                                                the stores

• Industry Costs and Capital Structure                    • Opportunities
   Low to moderate costs for each location             o Turkish coffee is served to
   Major start-up expenditures are property                               customers
   and equipment
   Major operating costs are labor and cost of
   sales                                                              •Threats
   McDonalds and Cinema                          o People who are against of States
                                                                    coffee culture

                                                                           18
Staffing

• Location has one manager, an assistant
  manager and 16 partners
• Benefits package includes health, dental,
  and vision care, stock options, free shift
  drinks, and a free pound of coffee each
  week
• Raises are based on semi-annual
  performance evaluations with raises
  ranging from 0-5%
• Bonuses are not utilized, but the location
  has given away non monetary rewards
• Motivated employees creates happy a
  loyal customers

                                               19
The Future

•   Schultz believed that the company had to challenge the status
    quo, be innovative, take risks, and alter its vision of who it was,
    what it did, and where it was headed. Under his guidance,
    management was posing a number of fundamental strategic
    questions:
    o What could Starbucks do to make its stores an even more elegant "third place"
      that welcomed, rewarded, and surprised customers?
    o What new products and new experiences could the company provide that
      would uniquely belong to or be associated with Starbucks?
    o What could coffee be—besides being hot or liquid? How could Starbucks reach
      people who were not coffee drinkers?
    o What strategic paths should Starbucks pursue to achieve its objective of
      becoming the most recognized and respected brand of coffee in the world?

                                                                           20
RESPONSIBILITY OF STARBUCKS

SPECULATIONS

ADVERTISING

RECOMMENDATIONS
SHARED PLANET and GLOBAL RESPONSIBILTY




•   ‘’Our commitment to doing business responsibly’’ for a better future
    for our World. We want to care for our communities because it is
    community that makes us who we are – that third place in your
    neighborhood.
•   Within this, Starbucks have identified three areas of focus:

    - Environmental stewardship
    - Ethical sourcing,
    - Community involvement.



                                                                       22
ENVIRONMENTAL STEWARDSHIP : 100% of our cups will be
               reusable or recyclable, and we will significantly reduce our
               environmental footprint through recycling, energy and water
               conservation and green constraction.




                    Recycling
   From back-house process of recycling to front-store recycling.
   Cup sleeve to avoid double cupping
   ‘’Bring your own tumbler, discount is 10 cents’’
   Recyclable plastic cups
   Recyclable napkins
   ‘’ The most extensively recycled material in the U.S.’’
Green Construction

   Starbucks is Pilot store in LEED (Leadership in Energy and
    Environmental Design) Certification Program
   using lover amounted organic chemicals for painting
   recyled flloring tiles





                        Energy and Water Conservation
       Water is the main ingredient in most beverages
       Dipper well washing system with stream
       They save 568 litres per day in one store
       Electric is the biggest impact on climate change
       Renewable energy equipment
ETHICAL SOURCING : buy and serve 100% responsibly
           grown and ethically traded coffee.
        FAIR TRADE
      To serve a great cup of coffee while helping to improve the lives of farmers
       and protect the environment
      Farmer support centers
      high-quality coffee for the future

COMMUNITY INVOLVEMENT :
contribute one million community
service hour annually.
       TURKEY
       Tohum Otizm Vakfı

       Kardeş Okul Project

       Building schools, libraries,
         village clinics
SPECULATIONS
1–COFFEE WARS
•The storm brew between Starbucks
and McDonalds.
•The fact is that coffee is more a
need than want.
•This 2 brand are polar opposites.
•Dunkin &Donats involved in fight by
affording 99 cent lattes all day.
•‘’Coffee war made us Better’’

2 -EFFECTS OF CRISIS ON STARBUCKS
Starbucks have decided to close 600
stores which are not profitable.
‘’Coffee businees affected by the
Mortgage Crisis. Around the
starbucks stores, there is a great
number of empty houses’’
ADVERTISING




   There was not any commercial about Starbucks, but its market
    products and social responsible projects.
   ‘’Focus on Quality’’
Ad champaign of Starbucks in
New York Times
RECOMMENDATIONS

•   Starbucks products shoukd be placed in international
    market, actually in most countries has bottled
    frappicino, ice cream , and coffee beans in markets ,
    but not in Turkey market.
•   Recycling facilities should be in Turkey for storage and
    recycling.
•   Car service should be enable for Starbucks
•   Starbucks should open stores in University campuses.
•   There sould be kid menus or beverages for kids
•   Gift card should be brougt in Turkey Starbucks stores.
Thank you 
 Questions
     &
 Comments

              30

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Beyond a Cup of Coffeé

  • 1. 1 STARBUCKS; BEYOND A CUP OF COFFEE Management and Organization Aykut Berber, PhD Sorted by presentation order; Evrim Gözener Işıl Topal İpek İpekliler
  • 2. Outline of the Presentation; • History of Starbucks; The company • Store’s Strategy is on Spotlight • Outsanding Contribution • Starbucks Offers a Little of • They grow up so fast… But how? Everything • Site Characteristics • Italy Issues… • Starbucks Organization Chart • Customer Oriented Strategy of • Industry and Competitive Analysis Starbucks Company • SWOT Analysis • Product Diversity • Staffing • Coffee Beans of Starbucks Quality • The Future • Beverages • Responsibility of Starbucks • Cup Sizes; Hot&Cold Beverages • Speculations • Starbucks Salty • Advertising • Starbucks Desert • Recommendations • Structure of Stores • Innovation Conduction • Starbucks Corporate Strategy 2
  • 3. Once upon a time Evolution of in Seattle… Starbucks logo; according the • Starbucks was opened in 1971 in history, Seattle, Washington by Jerry •The Starbucks siren was topless and had a Baldwin (a teacher) and Zev Siegel (a fully-visible double fish tail. teacher) and Gordon Bowker (a •In the second version, the logo also writer). inherited the stars from the Il Giornale logo • Howard Schultz, an entrepreneur, •In the current version, her navel and chest joined them in 1982. are not visible at all, and only vestiges • Mr. Schultz influenced coffee bars in remain of the fish tails. Italy and established the chains of II •Starbucks has grew from 55 stores in 1989 Giornale Coffee shops. to over approx. 20.000 locations today in 55 • A few years after, the first owners countries around the world bought of the Peet's Coffee and Tea •20 Million customers a week shop and Starbucks was transferred •Products sold include; Beverages to Mr. Schultz. Pastries • Finally, Starbucks was founded by Whole coffee beans combining two brands; II Giornale Coffee-related retail items ,such as; Mugs, and Starbucks. Travel mugs, Coffeé Machines, Thermos bottles 3
  • 4. Starbucks Offers a Little of Everything • Customer satisfaction priority is concept of the Starbucks Company • Products are tasted several times to markets of different countries • Implementation of customer satisfied; Starbucks card, gift card, some of stores have cd burning unit. • Turkish people was welcomed the first store on 2003 in Erenkoy Istanbul • Hot sleeve, Starbucks cards • Today , Starbucks has reached 106 stores in Turkey • Turkish coffee culture has not been changed • Starbucks to behave respectfully expanded in Turkey and has introduce filter coffee culture to Turkish people • Feeling unique experienced, think indivudially; every customer can create their own coffee. 4
  • 5. Italy Issues… • The main reason is that the coffeé in Italy too good • Italians have rejected Starbucks Coffeé • Italy has very complicated coffeé market 5
  • 6. Customer Oriented Strategy of Starbucks Company •Starbucks is the first chain of coffee shops found all over the world •Customers feel free all day with one cup of coffee without disturbing •To be the "extra place" people frequent after home and work. •Customer confidence; serving high quality fresh coffee in every stores around the world. •To address the five senses Tasting; Delicious coffee Touching; Comfortable chairs Listening; smooth jazz Smelling; excellent smells of roasted coffee And; nice view in every stores Various milk options, syrups and they have up 85,000 different drink combinations so priority of individual needs. 6
  • 7. Coffee Beans of Starbucks Quality •Starbucks coffee beans are grown in within an area, located near the equator between the tropic of Cancer and Capricorn Latin America Asia Pasific Product Diversity Arabian Peninsula oBrazil •Productions are oRogusto; sea level, 2% cafein changed for every oArabica; Starbucks preffered 1% cafein season; •A coffee tree contains 680 grams beans in a year. christmas blend •Starbucks always prefers washed and natural dried house blend beans. breakfast blend French roasted •A coffee tree averages from 15–30 ft. in height and Italian roasted at least 70 inches of rainfall year. Caffee Verona Decaf blend Kenya by Starbucks Sumatra by Starbucks Guatemala Antiqua 7
  • 8. Beverages; Alternative Espresso-based Cold Drinks Espresso –based Drinks •Caffé Latte with ice •Caffé Latte •Iced Caramel Macchiato •Cappuccino •Iced White Chocolate Mocca •Caramel Macchiato •Iced Caffé Americano •Caffé Mocca •Iced Chai Tea Latte •White Chocolate Mocca •Orange Juice •Caffé Americano Coffee – based Snowy Cold Drinks •Espresso •Coffee •Espresso Macchiato •Java Chip Chocolate •Espresso Con Panna •Caramel Classic Products of Starbucks: •Espresso •Coffee of the day Caramel – based Snowy Cold Drinks •Caffé Misto •Vanilla •Press Coffé •Java Chip Chocolate •Turkish Coffee •Caramel Other Delicious Alternative Fruit – based Snowy Cold Drinks •Premium Hot Chocolate •Rasberry Black Currant 8 •Mango Passion Fruit
  • 9. Cup Sizes; Hot&Cold Beverages Name Measurement Notes Short 8 oz (≈ 237 mL) Tall 12 oz (≈ 355 mL) Grande 16 oz (≈ 473 mL) Italian for Large 20 oz hot (≈ 591 mL), 24 oz cold Venti Italian for twenty (≈ 710 mL) Trenta 31 oz cold only (≈ 917 mL) Italian for 9 thirty
  • 10. Starbucks Salty Starbucks Deserts oPeach pie •Ryan Bread with Turkey oProfiterole cake •Mini whole wheat with cheese oMosaic Pie •Mistic oBrownie cheesecake •Vegetable pie oWhite chocolate raspberry cheesecake •Chicken Sandwich oLemon cheesecake •Fiesta oBella vista •Ham and wheese oCarrot Cake •Three cheese sandwich oWhole wheat carrot cake •Ham wrap oMosaic Cake •Vegetable wrap oLemon cake •Sesame bagel with cheese oStarbucks brownie •Cheese crossant and roll oDoppio cookie •Whole wheat puff oMisto cookie •Olive puff oBerliner oCookie of Chocolate walnut 10
  • 11. Store Manager Structure of Stores Assistant Manager •Every store has equal quality •Starbucks also serves local beverages and taste of foods Shift Supervisors •Stores design and goods are almost look alike •Some of stores serve wine in Canada and the States Baristas Baristas Baristas •Organization Chart of stores are exactly alike •Starbucks does not franchise operations and has no plans to franchise in the foreseeable future •One Major frenchising around the world; Turkey, Russia and Meiddle East is connected Shaya Group Company •Being a Starbucks employee means; to work a multi-national / global company 11
  • 12. Innovation Conduction •Every store has equal quality •Starbucks also serves local beverages and taste of foods •Stores design and goods are almost look alike •Some of stores serve wine in Canada and the States •Organization Chart of stores are exactly alike •Starbucks does not franchise operations and has no plans to franchise in the foreseeable future 12
  • 13. A Delicious Idea; “Establish Starbucks as the premier purveyor of the finest coffee in the world while maintaining our uncompromising principles while we grow.” Starbucks Corporate Strategy • Maximize market penetration • Provide a relaxing, attractive social atmosphere • Offer high-quality products • Create a great working environment • Achieve profitability 13
  • 14. Store’s Strategy Outsanding Contribution • It is to create a comfortable Third • Entrepreneurs make unique Place environment like your contributions to the American home (socializing, playing game, homeworks, working, discussing economy: place) • Create innovations that • Serve customer a customized improve our quality of life: high-quality product and expand product range • Entrepreneurs create new jobs: (sandwiches,beverages,apple CD • Entrepreneurs improve the burning) position in global economic • Minimize overall expenses by competition: focusing on controllable expenses • customer portolio impact service • Entrepreneurs reinvest their quality (A Class and C Class newly created wealth in the customers) community: • Customer satisfaction – ambience,service,offer 14
  • 15. They grow up so fast… But how? • Start with a good business Growth of Starbucks concept 7000 • Think big 6000 • Think outside the box 5000 • Create a unique expreince Number of Stores 4000 • Keep customers happy 6294 3000 • Dig deep in the customer’s 4707 wallet 2000 2135 • Good management 1000 1412 676 17 55 116 272 S1 0 1987 1989 1991 1993 1995 1997 1999 2001 2003 Years 15
  • 16. Site Characteristics Since, they have won accounts • Most stores ranged in size from with many other companies, 1,000 to 1,500 square feet and were located in office buildings, downtown such as: and suburban retail centers, airport • Westin Hotels terminals, university campus areas, or • Canadian Airlines busy neighborhood shopping areas convenient to pedestrian foot traffic. • Kraft Foods (to extend into grocery stores) • Only a select few were in suburban • Hyatt Hotels Corp. malls. While similar materials and • Apple furnishings were used to keep the • Sheraton Hotels (now Starwood look consistent and expenses Hotels) reasonable, no two stores ended up • United Airlines being exactly alike. • Nordstrom • Canadian Bookstore Chapter • Msnbc 16
  • 17. Starbucks Organization Chart CEO President Executive VP, Executive VP, Executive VP, Executive VP, Legal Supply Chain & Coffee Partner Resources Chief Financial Officer Senior VP, Coffee President, Japan President, Europe, •Functional in structure and relatively flat Middle East, Africa •Team work, workload share is essential President, North America •Basic management style is Laissez Faire VP, Southwest •Management motivates through reviews VP, South Central and raises VP, •Work duties are assigned by shift President, Northwest supervisors International •Employees are allowed to use initiative United Kingdom and empowered to make decisions Australia •Team Work Thailand •Employee Training 17
  • 18. Industry and Competitive SWOT Analysis Analysis • Strengths o Largest market share in industry • Competitive Activity o Differentiated atmosphere oMany companies are in the market and competition is fierce oCompetitors use location, product mix, • Weaknesses and store atmosphere differentiation to o Cought dirtiness and cleaness in establish market niche the stores • Industry Costs and Capital Structure • Opportunities Low to moderate costs for each location o Turkish coffee is served to Major start-up expenditures are property customers and equipment Major operating costs are labor and cost of sales •Threats McDonalds and Cinema o People who are against of States coffee culture 18
  • 19. Staffing • Location has one manager, an assistant manager and 16 partners • Benefits package includes health, dental, and vision care, stock options, free shift drinks, and a free pound of coffee each week • Raises are based on semi-annual performance evaluations with raises ranging from 0-5% • Bonuses are not utilized, but the location has given away non monetary rewards • Motivated employees creates happy a loyal customers 19
  • 20. The Future • Schultz believed that the company had to challenge the status quo, be innovative, take risks, and alter its vision of who it was, what it did, and where it was headed. Under his guidance, management was posing a number of fundamental strategic questions: o What could Starbucks do to make its stores an even more elegant "third place" that welcomed, rewarded, and surprised customers? o What new products and new experiences could the company provide that would uniquely belong to or be associated with Starbucks? o What could coffee be—besides being hot or liquid? How could Starbucks reach people who were not coffee drinkers? o What strategic paths should Starbucks pursue to achieve its objective of becoming the most recognized and respected brand of coffee in the world? 20
  • 22. SHARED PLANET and GLOBAL RESPONSIBILTY • ‘’Our commitment to doing business responsibly’’ for a better future for our World. We want to care for our communities because it is community that makes us who we are – that third place in your neighborhood. • Within this, Starbucks have identified three areas of focus: - Environmental stewardship - Ethical sourcing, - Community involvement. 22
  • 23. ENVIRONMENTAL STEWARDSHIP : 100% of our cups will be reusable or recyclable, and we will significantly reduce our environmental footprint through recycling, energy and water conservation and green constraction. Recycling  From back-house process of recycling to front-store recycling.  Cup sleeve to avoid double cupping  ‘’Bring your own tumbler, discount is 10 cents’’  Recyclable plastic cups  Recyclable napkins  ‘’ The most extensively recycled material in the U.S.’’
  • 24. Green Construction  Starbucks is Pilot store in LEED (Leadership in Energy and Environmental Design) Certification Program  using lover amounted organic chemicals for painting  recyled flloring tiles  Energy and Water Conservation  Water is the main ingredient in most beverages  Dipper well washing system with stream  They save 568 litres per day in one store  Electric is the biggest impact on climate change  Renewable energy equipment
  • 25. ETHICAL SOURCING : buy and serve 100% responsibly grown and ethically traded coffee. FAIR TRADE  To serve a great cup of coffee while helping to improve the lives of farmers and protect the environment  Farmer support centers  high-quality coffee for the future COMMUNITY INVOLVEMENT : contribute one million community service hour annually. TURKEY  Tohum Otizm Vakfı  Kardeş Okul Project  Building schools, libraries, village clinics
  • 26. SPECULATIONS 1–COFFEE WARS •The storm brew between Starbucks and McDonalds. •The fact is that coffee is more a need than want. •This 2 brand are polar opposites. •Dunkin &Donats involved in fight by affording 99 cent lattes all day. •‘’Coffee war made us Better’’ 2 -EFFECTS OF CRISIS ON STARBUCKS Starbucks have decided to close 600 stores which are not profitable. ‘’Coffee businees affected by the Mortgage Crisis. Around the starbucks stores, there is a great number of empty houses’’
  • 27. ADVERTISING  There was not any commercial about Starbucks, but its market products and social responsible projects.  ‘’Focus on Quality’’
  • 28. Ad champaign of Starbucks in New York Times
  • 29. RECOMMENDATIONS • Starbucks products shoukd be placed in international market, actually in most countries has bottled frappicino, ice cream , and coffee beans in markets , but not in Turkey market. • Recycling facilities should be in Turkey for storage and recycling. • Car service should be enable for Starbucks • Starbucks should open stores in University campuses. • There sould be kid menus or beverages for kids • Gift card should be brougt in Turkey Starbucks stores.
  • 30. Thank you  Questions & Comments 30