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Starbucks - PESTLE ANALYSIS

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our group's presentation of Starbucks (Northumbria University - Newcastle Upon Tyne, UK)

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Starbucks - PESTLE ANALYSIS

  1. 1. 10th October 2011
  2. 2. Team
  3. 3. ContentsI. Overview Starbucks -MilestonesII. PESTLE-Analysis • General Information • P – Political Issues • E – Economical Issues • S – Social Issues • T – Technological Issues • E – Environmental Issues • L – Legal IssuesIII. Conclusion
  4. 4. I. Company overview – Milestone (1)• Founded 1971 in Seattle‘s Pike Place Market• 1982: Howard Schultz becomes Director of Retail Ops; – Starbucks provides coffee to fine restaurants and espresso bars• 1984: First Starbucks Coffeehouse in Downtown Seattle• 1988: Full Health Benefits to employees• 1995: over 500 US-stores
  5. 5. Company Overview – Milestones (2)• 1998: starbucks.com• 2000: licencing agreement with TransFair USA to sell Fairtrade coffee in USA and Canada• 2009: East Africa Farmer Support Centre in Kigali /Rwanda; Social Engagement to save lives in Africa• 2010: Asia Farmer Support Centre in Yunnan, China• Total Stores: approximetely 17,000
  6. 6. II. PESTEL ANALYSIS Economical Political SocialTechnological Legal Use: Measuring the organization’s goals against influences and Environmental demands of environment
  7. 7. 1. Political issues - Issues: Stability of political environment, law, taxes, policies on economy, trading agreements, government’s view on culture and religion, terrorism  Example: Hong Kong, Thailand
  8. 8. 2. Economical issues The level of inflation. Interest rates. Income per capita. Long-term perspectives for the economy.  Stabilization  Unemployment rate
  9. 9. 3. Social issuesOur Mission: to inspire and nurture the human spirit– one person, one cup and one neighborhood at a time.Goals: -Continious Improvement of Quality External Stakeholder (Customer) Satisfaction -„Business Endurance and thrive― -Ethical Sourcing Raising living standards in Production Areas
  10. 10. Social issues (2) Goals: -Promotion of Diversity and Respect  Internal Stakeholder Satisfaction -Integrating into the community (environment-orientated goals) -Responsibility „to be good neighbours― -Connection between value chain (suppliers, partners, customers) and community -Everyday contribution through positive action -Success in Business (organization-orientated goals)
  11. 11. Social issues (3) - Critizism  Defense Genetically modified - Fair Trade support ingrdients • LESS THAN 10% OF TOTAL Implications: PURCHASES!!! Financial - Only traditional Moral brewing Legal - Blaming on US Loss of reputation legislation
  12. 12. 4. Technological issues• Technology has been played a vital role in Starbucks  Example:  Starbucks card  Starbucks Pay-By-Phonehttp://www.techhog.com/featured/app-review-my-coffee-card-vs-starbucks-for-android/
  13. 13. 5. Environmental issues Recycling: Recycling in Stores, Reusable cups, Greener Cups. Composting of coffee ground. Energy:Reduce energy consumption by 25% by 2010. Purchase renewable energy equivalent to 50% of the electricity used by 2010 Water: continue to include water-saving technology in our equipment specifications and going to reduce water consumption by 25% by 2015
  14. 14. Environmental issues (2)  Green Building:create a system to certify retail stores and store prototypes.Beginning in December 2010, build all new, company-owned stores to achieve LEED® certification  Climate Change: implementing a climate change strategy since 2004, focusing on renewable energy, energy conservation, and collaboration and advocacy. ensure a long-term supply of high-quality coffee through responsible coffee purchasing practices and by investing in farmers and their communities. Source: Starbucks USA Homepage
  15. 15. 6. Legal issues Employment law: working time, age, minimum wage rate, etc. - Ex: Starbucks CEO’s announcement that he’s cutting his own salary from $1,2 million to $ 10.000 per year (Shawvalenza.blog, 2009) Health and safety regulations - Ex: Starbucks spend more on health insurance — $250 million — surmount its coffee bill (Chief executive Howard Schultz, 22/03/2011) Consumer protection: - Ex: Starbucks pay $225.000 to settle Consumer Protection case for gift card violations. (Santa Rosa, CA , 2009) - Ex: Stored-valued card: this is a prepaid card offer by Starbucks.
  16. 16. III. CONCLUSION Politics: Starbucks concerns about political issues in different countries Economics: constantly growing; raising market capital since 2009 (28bn USD, share value: 40,86 USD). Sales decline due to econ. crisis Society: Non-conformance with aims, loss of image and credibility Technology: state of the art tech. equipment integration in business processes Environment: focus on producing green products, conducting environmental campaign, climate change Law: favourable employee conditions, reasonable proportion of wages, consumer protection Adequate marketing activities essential for future development,focus on CSR and company image among the customers
  17. 17. References Oscar. V. (2010) Starbucks growing in the Spanish market, Oscarvadillo, [Online]. Available at: http://www.google.com.vn/url?sa=t&source=web&cd=1&ved=0CBkQFjAA&url=http%3A%2F%2Fwww.osca rvadillo.info%2Fuploads%2F6%2F5%2F2%2F6%2F6526599%2Fstarbucks_growing_in_the_spanish_market .pdf&rct=j&q=Oscar%20Vadillo%20(2010)STARBUCKS%20Growing%20in%20the%20Spanish%20Market% 20%09&ei=hVKTTsSnLsap8QPuouBB&usg=AFQjCNF37GL3TKwwHj0Qp5r5E1XSIyvT7g&cad=rja (Accessed: 09 October 2011). Oxford University Press (2010) PESTEL analysis of the macro-environment, Oxford University Press, [Online]. Available at: http://www.oup.com/uk/orc/bin/9780199296378/01student/additional/page_12.htm (Accessed: 10 October 2011). Politico (2011) ‘Starbucks CEO rethinks health law position, Politico, [Online]. Available at: <http://www.politico.com/news/stories/0311/51727.html#ixzz1aOXYdpe9> (Accessed: 09 October 2011). Starbucks (2009) ‘Annual report, Starbucks, [Online]. Available at: <http://media.corporate- ir.net/media_files/irol/99/99518/SBUX_AR.pdf> (Accessed: 10 October 2011). Starbucks (2011) ‘Facts about Starbucks in Middle East, Starbucks, [Online]. Available at: < http://news.starbucks.com/article_display.cfm?article_id=200> (Accessed: 09 October 2011). Starbucks (2011) ‘Mission Statement, Starbucks, [Online]. Available at: < http://www.starbucks.com/about- us/company-information/mission-statement> (Accessed: 09 October 2011). Starbucks (2011) Responsibility, Starbucks, [Online]. Available at: < http://www.starbucks.com/responsibility/environment> (Accessed: 09 October 2011). Technorati (2011) ‘Starbucks pay-by-phone, Technorati, [Online]. Available at: <http://technorati.com/technology/article/new-starbucks-pay-by-phone-will/> (Accessed: 09 October 2011).
  18. 18. Many thanks for your attention
  19. 19. Q&A P E S T E L

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