SA of Tata Starbucks.pdf

A Project Work on
Strategic Alliance of Tata Starbucks
By
Students of
Divaba Institute of Business Administration
Semester: - 6
Guided By
Ms. Bhakti Patel & Mrs. Veena Kumari
Assistant Professors
A Project Work
Submitted to
Gujarat University
In Partial Fulfillment of the Requirements for
Subject CC-313: Grand Project, Presentation & Viva Voce
In B. B. A. (Bachelor of Business Administration)
April / May -2022
Divaba Institute of Business Administration (532)
SNME Campus, At- Anasan, Ta. - Dascroi,
Ahmedabad-382330.Gujarat, India

List of Group Members
Serial
No.
Enrollment No. Seat No. Student’s Name Sign
01 201610100954 PUROHIT PRAVIN KISHORKUMAR
02 201910101237 GOHIL RIYA JAYANTIBHAI
03 201910101238 MANDANAKA MEHUL LALJIBHAI
04 201910101242 PATEL DHRUVI BHARATBHAI
05 201910101245 PRAJAPATI KRUTI DIPAKBHAI
06 201910101247 PRAJAPATI SANJAY RAMSWARUP
07 201910101248 PUROHIT SUMITKUMAR GAURISHANKAR
08 201910101250 SHELADIYA SAHILKUMAR ASHOKKUMAR
09 201910101252 TIWARI KHUSHI JITENDRAKUMAR
10 201910101255 WAGHELA SHIVENDRA KANHAIYALAL

Ahmadabad -382330. Gujarat, India
CERTIFICATE
This is to certify that this Project Work on “Strategic Alliance of Tata Starbucks” submitted in
partial fulfillment of the requirement for the degree of Bachelor of Business Administration, of
Gujarat University.
This is a bonafide work done by, Students of Divaba Institute of Business Administration (532)
under our guidance and that no part of this project has been submitted for any other Degree/Diploma.
Year: April/May -2022
Stamp and Signature
Director
Anasan, Ahmedabad-30

SNME Campus, At- Anasan, Ta.- Dascroi,
Ahmedabad -382330. Gujarat, India
CERTIFICATE
This is to certify that this dissertation entitled “Strategic Alliance of Tata Starbucks" in partial
fulfillment of the requirement for the degree of Bachelor of Business Administration, of Gujarat
University.
This is a bonafide work done by, Students of Divaba Institute of Business Administration (532) under
guidance and that no part of this project has been submitted for any other Degree/Diploma.
Name and Signature of Examiner

Ahmadabad -382330.Gujarat, India
CERTIFICATE
This is to certify that this Project Work on "Strategic Alliance of Tata Starbucks” submitted in
partial fulfillment of the requirement for the degree of Bachelor of Business Administration, of
Gujarat University.
This is a bonafide work done by, Students of Divaba Institute of Business Administration (532)
under my guidance and that no part of this project has been submitted for any other Degree/Diploma.
Guided by
Signature of guide
(Ms. Bhakti Patel & Mrs. Veena Kumari)
(Assistant Professors)
Divaba Institute of Business Administration,
Anasan, Ahmedabad-30

DECLARATION
We undersigned students of Divaba Institute of Business Administration hereby that this project
entitled “Strategic Alliance of Tata Starbucks” is result of our own research work and has not been
previously submitted to any other university for any other examination. We hereby further declare
that all information of this document has been obtain and presented in accordance with academic
rules and ethical conduct.
Year: April / May-2022
S. No. Name Sign.
01 PUROHIT PRAVIN KISHORKUMAR
02 GOHIL RIYA JAYANTIBHAI
03 MANDANAKA MEHUL LALJIBHAI
04 PATEL DHRUVI BHARATBHAI
05 PRAJAPATI KRUTI DIPAKBHAI
06 PRAJAPATI SANJAY RAMSWARUP
07 PUROHIT SUMITKUMAR GAURISHANKAR
08 SHELADIYA SAHILKUMAR ASHOKKUMAR
09 TIWARI KHUSHI JITENDRAKUMAR
10 WAGHELA SHIVENDRA KANHAIYALAL
Date:
Place: Ahmedabad

ACKNOWLEDGEMENT
We want to use this platform to say a very heartily to God almighty for bringing me this far. All glory
is to their name.
We heartily acknowledge our sincere gratitude to my research guide, respectable Ms. Bhakti Patel &
Mrs. Veena Kumari, Assistant Professors, Divaba Institute of Business Administration, Anasan,
Ahmedabad. Their able guidance, encouragement and support from the initial to the final level
enabled us to development and understanding of the subject. Their comments and supervision helped
us to solve my difficulties and hurdles during research work.
The experience of working under their guidance has proved quite fruitful as it gave me an
opportunity to work under their expertise due to their command over the subject. In spite of their
commitments with other activities, they have always spared their valuable time to assess our work.
We express our gratitude to their valuable support.
Heartily thanks to all faculty members at Divaba Institute of Business Administration, Anasan,
Ahmadabad whose ideas, critical insights and suggestions have been invaluable in the preparation of
this project.
Last but not least we would like to extend my deep sense of gratitude to God, our parents, all family
members, friends and our well-wishers who have directly or indirectly supported and helped us in the
completion of our project successfully.

Index
Ch.
No.
Particulars Page
No.
1 Introduction
1.1 About 1
1.2 Purpose 3
1.3 Entry of Starbucks in Indian Market 4
1.4 Strategic Intent 4
1.5 Mission & Vision 6
1.6 Importance and Benefits of Strategic Alliance of Tata Coffee and Starbucks 7
1.7 Market Share 8
2 Environment Analysis
2.1 SWOT Analysis 9
2.2 PESTLE Analysis 13
2.3 Five Force Model 16
3 Research Methodology
3.1 Introduction 19
3.2 Rationale of Topic 19
3.3 Type of Research Design 19
3.4 Sources of Data 20
3.5 Sampling Plan 21
3.6 Data Analysis Tools 21
3.7 Limitation of the Study 22
4 Data Analysis 23
5 Conclusion 42
Bibliography 43
Questionnaire 44

1
Chapter 1
Introduction
1.1 About
In January 2011, Starbucks Corporation and Tata Coffee, Asia's largest coffee
plantation company, announced plans for a strategic alliance to bring Starbucks to India
and also to source and roast coffee beans at Tata Coffee's Kodagu facility.
Despite a false start in 2007, in January 2012 Starbucks finally announced a 50:50 joint
venture with Tata Global Beverages, called Tata Starbucks Ltd., which would own and
operate outlets branded Starbucks "A Tata Alliance". Starbucks had previously
attempted to enter the Indian market, in 2007, with a joint venture involving its
Indonesian franchise and Kishore Biyani of the Future Group. However, the joint
venture withdrew its foreign investment proposal with the Indian government.
Starbucks did not cite any reason for the withdrawal
On 19 October 2012, Starbucks opened its first store in India, measuring 4500 sq. ft. in
Elphinstone Building, Horniman Circle, Mumbai. Starbucks expanded its presence to
Delhi on 24 January 2013 by opening 2 outlets at Terminal III of the Indira Gandhi
International Airport, and later one in Connaught Place.

2
In early 2013, Tata Global Beverages announced that the JV would meet its target of
opening 50 outlets of the world's largest coffee chain in India by this year, one year later
than originally scheduled, with an investment of Rs4 billion(US$68 million)
Initially, Starbucks opened a combination of standalone outlets located at malls, airports
and metro stations, and commercial complexes. The company plans to expand its retail
footprint in India by opening outlets in hospitals, near gyms or health stores, educational
institutions and corporate campuses. Similar to the strategy employed by competitor
Cafe Coffee Day. The company also plans to avoid hypermarkets, as it would impact
the positioning of the brand. The decision to open outlets inside Tata-owned retail stores
and properties would depend on the brand's premium positioning.
The third city of India to get a Starbucks outlet was Pune, where the company opened
an outlet off North Main Road at Koregaon Park, on 8 September 2013. Starbucks
opened a 3,000-square-foot flagship store opposite Raheja Arcade, 7th Block,
Koramangala, Bangalore on 22 November 2013, making it the fourth city to have an
outlet.
Starbucks opened the largest coffee-forward store in the country at Vittal Mallya Road,
Bangalore on 18 March 2019. The store measures 3,000 sq.ft. And is Starbucks' 140th
outlet in India. Tata Starbucks opened 25 stores in 2017-18 and 30 in the 2018–19 fiscal
year
On 21 February 2019, CEO Navin Gurnaney announced that Tata Starbucks would
transition to using only compostable and recyclable packaging materials across all its
stores from June 2020.
Starbucks announced its entry into the Gujarat market on 7 August 2019. The company
simultaneously opened five stores in Surat and Ahmedabad the next day. Starbucks'
flagship store in the state is located at Prahlad Nagar, Ahmedabad and offers more
vegetarian options than other Indian outlets.
CEO Navin Gurnaney stated that the company would open more than 30 stores in the
2019-20 fiscal year, of which 11 had already opened. The company opened its 170th
outlet and the first in Vadodara in December 2019.
The company opened its 200th store at Amritsar, Punjab on 22 October 2020. Starbucks
entered into Madhya Pradesh in February 2021 by opening 3 stores in Indore and
Bhopal with further expansion plans in Indore.
Starbucks entered Rajasthan by opening 2 stores in Jaipur in August 2021. On 10
February 2021, the company announced that Navin Gurnaney was stepping down as
CEO. Sushant Dash, who is currently President, Packaged beverages at Tata Consumer
Products, will replace him as CEO effective 1 May 2021.

3
Number of Tata Starbucks Private Limited stores from financial year 2013 to 2021
1.2 Purpose
As of November 2021, the company had 33,833 stores in 80 countries, 15,444 of which
were located in the United States. Out of Starbucks' U.S.-based stores, over 8,900 are
company-operated, while the remainder is licensed.
The rise of the second wave of coffee culture is generally attributed to Starbucks, which
introduced a wider variety of coffee experiences. Starbucks serves hot and cold drinks,
whole-bean coffee, micro-ground instant coffee, espresso, cafe latte, full and loose-leaf
teas, juices, Frappuccino beverages, pastries, and snacks. Some offerings are seasonal,
or specific to the locality of the store. Depending on the country, most locations offer
free Wi-Fi.
Developing and delivering services that retain customer loyalty and satisfied is the main
goal of Starbucks Coffee Company in India. This objective aims at maintaining current
customers alongside attracting prospective ones. This tends to work well in increasing
profitability, market share, customer equity, and revenue base. Moreover, both the
coffee and other beverage products processed by Starbucks target primary, secondary
and emerging markets.
12
42
72
82
91
116
146
185
221
0
50
100
150
200
250
FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 FY 2021
No.
of
Coffee
Shops
Financial Year

4
1.3 Entry of Starbucks in Indian Market
After a false start in 2007 with an Indonesian franchise partner and the Indian Future
Group, Starbucks finally announced its plan to enter India in 2011. Early entry has
several benefits, such as access to critical resources and markets in an Indian
perspective.
Starbucks had to be cautious due to the earlier missed opportunity, and therefore entered
India through a 50:50JV between Tata Global Beverages and the Starbucks Corporation,
branded as “Starbucks – A Tata Alliance.”
The selection of a local partner in emerging markets is primarily a crucial step in
establishing a successful business there. For Tata Starbucks Ltd, the coffee is sourced
and roasted locally. It is the first time that the enterprise runs an outlet based on a
partner-owned roasting facility outside its plants. The case is a typical example of
collaboration between an emerging market firm and a firm from a developed country.
Starbucks offers the conventional resources of a company entering emerging markets,
such as technical capabilities, intangible resources, and willingness to share expertise,
what is demonstrated clearly through a strong brand.
Starbucks’ specialized technical knowledge in building unique stores is beneficial for its
global operations. The outlets provide the atmosphere of a local coffee shop rather than
that of a fast food restaurant.
Tata offers access to India-specific resources, local market knowledge, and a strategic
network. Through this alliance, Starbucks also obtained the expertise to deal with an
unknown institutional environment, which is an additional strategic advantage.
1.4 Strategic Intent
Tata Global Beverages Limited and Starbucks Coffee Company launched a joint
venture between the iconic international coffee brand and the 2nd largest branded tea
company in the world. The 50/50 joint venture, named TATA Starbucks Limited, owns
and operates Starbucks cafés, branded as Starbucks Coffee “A Tata Alliance.”
The first store has already opened and subsequent stores are in line to be opened at
Mumbai in India at the end of October, 2012. The alliance is expected to be very fruitful
to both the companies in the long run. The report seeks to strategically assess the
viability of this strategic alliance by peeping into its myriads of dimensions.

5
SITUATIONAL ANALYSIS India and China are the world‘s two fastest growing
economies. Starbucks had already ventured into the Chinese market and not
surprisingly, their Chinese venture turned out to be much profitable than that of their US
business. Thus, they want to replicate their success in Chinese mainland in India.
Also, the Indian market is heavily driven by the upcoming youth culture which is totally
driven by the western trends. With the growing disposable income of Indians, people
tend to spend more towards apparels and fast foods. With the success of Indian owned
Café Coffee Day and Barista Coffee, it is a widely proven fact that there is lot of scope
for the development of coffee café culture in India. Thus, Starbucks want to capitalize
on this particular opportunity.
They are planning to start with targeting the niche upper class segment by opening their
outlets in TAJ Hotels and Resorts. Their primary target market is the younger
generation of age 16-40years. They will also target the tourists who will be visiting
India. Since, most of the tourists coming to India are from the countries of U.S.,
England, Germany, and Japan who are well aware of Starbucks brand name. Thus, there
will not be the problem of brand name recognition among them.
STRATEGIC INTENT Starbucks Corp. is aiming India as its next major hub for
development. Starbucks want to replicate the success they had in USA and more
recently, in china. Surprisingly, their venture in China proved to be more profitable than
that of US.
Here in India, Starbucks entered into a deal with TATA Coffee Ltd, Asia's largest
publicly traded coffee grower. This is, in particular, a non- binding agreement between
two giants. There are plans to combine the trust and legacy of TATA coffee with the
iconic brand image of Starbucks which can move on to development of Starbucks retail
coffee chains in other parts of Asia.
In addition to sourcing coffee beans from TATA‘s Indian facilities, the companies will
also work towards developing Starbucks stores in retail outlets and hotels.

6
1.5 Mission & Vision
Mission
The Starbucks mission statement describes six guiding principles that, as you can see,
also communicate the organization’s values: Provide a great work environment and treat
each other with respect and dignity. Embrace diversity as an essential component in the
way we do business.
Starbucks has a very clear and concise mission statement, which is
“To inspire and nurture the human spirit–one person, one cup and one
neighborhood at a time.”
This mission statement has been able to help the company grow from just a coffee shop
to an international coffee empire.
Vision
Starbucks coffee does not readily present its vision statement.
“To establish Starbucks as the premier purveyor of the finest coffee in the
world while maintaining our uncompromising principles while we grow.”
It outlines the critical achievements the company must realize to rank and maintain
itself as a top brand within this sector.
In the vision statement, they have clarified their goal and organizational values.

7
1.6 Importance and Benefits of Strategic Alliance of Tata Coffee and
Starbucks
Starbucks is very quality driven organization and is passionate about ethically sourcing
the finest coffee beans, roasting them with great care and improving the lives of people
who grow them.
Starbucks call their employees as the partners and treat each other with respect and
dignity. The employees at Starbucks get engaged with their customer and connect with
them so as to laugh with them, uplift customers' lives even if it is just for moments.
They believe in human connection and developing the sense of belonging. They believe
in creating good neighborhood and each store is nourished as a community (Ryan,
2008).
Tata has made the cultural fit for Starbucks which will help in building core
competencies of each other. (Tata has met all the stringent standards and conditions
followed by Starbucks such as quality, soil, water, pest, waste and energy management,
forest and biodiversity conservation to workers’ welfare, wages and benefits, living
conditions, health, safety, etc.).
Starbucks is committed to a role of environmental leadership in all facets of their
business. They strive to fulfil this mission by a commitment to:
1. Understanding of environmental issues and sharing information with their partners.
2. Developing innovative and flexible solutions to bring about change.
3. Striving to buy, sell and use environmentally friendly products.
4. Recognizing that financial responsibility is essential to their environmental future.
5. Instilling environmental responsibility as a corporate value.
6. Measuring and monitoring the progress for each project.
7. Encouraging all partners to share in their mission.

8
1.7 Market share
Starbucks Coffee Market Share In India
Starbucks had cornered over two-thirds of the coffee café market in China until 2010,
estimates Euro monitor, even if aggressive domestic rivals have more recently cut its
market share to 60%. Friend of Euro monitor says Starbucks has been able to replicate
some of this success in India, too.
India coffee shops / cafes market is highly fragmented, with Café Coffee Day, Costa
and Starbucks being few of the leading chained coffee shops operating in the country.
“India Coffee Shops / Cafés Market Forecast, Consumer Survey and Opportunities,
2021” discusses the following aspects of the India coffee shops / cafés market in India:
In January 2011, when Starbucks chairman and CEO Howard Schultz made his maiden
India visit to sign the 50:50 JV with Tata Global Beverages, hopping over to Asia’s
largest coffee maker Tata Coffee’s 8,258 sq. feet roasting facility at Kushalnagar near
Coorg made perfect sense.
India has seen a growth in the consumption of coffee sold at coffee and tea chain stores
including homegrown Café Coffee Day, Barista, Starbucks and Costa Coffee. The value
of this market has grown to an estimated 25 billion Indian Rupees in 2018. A surplus
production of milk & coffee
India was a large, but complex market, fragmented along age, geographic, income, and
demographic lines. Continued success was not certain. It was not yet clear how
Starbucks should best adapt.

9
Chapter 2
Environment Analysis
2.1 SWOT Analysis
The core competence of Tata coffee and Starbucks has been its ability to efficiently and
effectively leverage the cornerstone product differentiation strategies by offering a
premium quality coffee and product mix of high quality beverages and snacks.
Starbuck’s built its brand only by selling the finest quality coffee and related products,
and it provided each customer a unique “Starbucks Experience”, that is consequent from
ultimate customer service, clean environment and well-maintained stores that imitate
the culture of the communities in which they operate.
This resulted in high satisfaction and high degree of customer loyalty. The other core
areas of Starbucks are human resource management's values-based approach that builds
good internal and external relationships with vendors.
This mainly drives successful deployment of Tata Starbucks business strategy of
organic expansion into global markets Today, Starbucks is being recognized as the most
respected brands in the world as it mainly prefers horizontal integration through
acquisitions and alliances that maintains the long-term strategic plans.
SWOT
Strength
Weakness
Opportunities
Threats

10
Strengths:
1. High Brand Visibility and Global Brand recognition.
2. Location and artistic appeal of its stores.
3. Superb Marketing and positioning skills of Starbucks.
4. Use of Technology and mobile outlets.
5. Diverse Product Mix.
6. Customer base loyalty.
7. Access to TATA's premium Robusta and Arabica coffees (Sourcing Agreement).
8. Both the companies are leading company in their sector.
9. Ethical and Environmental Practices.
10. High-quality green coffee beans.
11. Consider jointly investing in additional facilitates for exports to other foreign
markets.
12. Tata coffee and Starbucks has a goodwill among customers due to Social
Responsibility Initiatives.
13. Both the companies utilize the resources of each other in enhancing their core
competency. Tata as a cultural fit for Starbucks will help in building core
competencies of each other as Tata has met all the standard and conditions levied by
the Starbucks such as quality, waste management, conservation of workers welfare,
etc.).
Weakness:
1. The Tata Starbucks is carrying the image of luxury coffee outlets. The people
visiting coffee outlets are rare in India as the price per coffee is very high in the
outlets.
2. Expensive products: High price of coffee is felt as a barrier among the Indian
customers. (Starbucks coffee products are priced at a very high and the income of
Indians are lesser when compared to other foreign markets where Starbucks already
exists. Now, Tata Starbucks has to rethink to offer coffee at locally competitive
prices).
3. Coffee dominant business. (Starbucks has to diversify its business from coffee to
providing other snacks and food items to face the competition from rivalries which
have already diversified).
4. Certain rigid standards and policies at outlets. (Starbucks follow the similar business
models and formulas, despite of culture and traditions of the any country they are
operating in like no smoking policy, etc.).
5. There is no uniqueness and exclusivity from these two companies i.e., Starbucks and
Tata coffee.

11
Opportunities:
1. India is the second most populated country in the world. There is scope for Tata
Starbucks to capture the market because of huge market.
2. The Middle Class with English speaking people is growing rapidly and the spending
power of Indians is increasing.
3. The young population is increasing who shows more interest in visiting the cafes as
a fashion statement. (Consumer of 20-45 years age group is emerging as the fastest
increasing consumer group. As per the research, an average age of Indians is going
to be 29 years by 2020.
4. Good and quality telecom infrastructure.
5. As Indians are habituated with Tea-based culture, this could be uses as an
opportunity by Starbucks to offer tea-based drinks.
6. People prefer to have a cup of coffee outside home rather than tea outside home,
specifically in the North-Eastern states of India. The southern states people like to
consumer coffee. The North Indians are not generally coffee drinkers, but drink
coffee as a fashion statement.
7. Tata coffee can increase its market share by providing the raw products to Global
players who are in the Coffee outlets business. Cheap Labor, Fair availability of
workforce (Quantity as well as skilled) and resources.
8. The expected growth rate of Coffee consumption in India is 6%, this can be used an
opportunity to set up more outlets in many cities.
9. By this deal, Tata Coffee is able to lower the over dependence on the commodities
market and shift to the branded Coffee retail market.
10. Brand extension: Starbucks and Tata coffee carries a good brand image in the
international market. So, it can leverage it to extend its business by diversification
and expansion of business while keeping brand image in consideration.
Threats:
1. Indians are habituated with tea and have a tea-based culture. (The hot-beverage
market of India is purely dominated by tea. As, India being a largest producer and
consumer of tea in the world, its production is accounted for 29% and consumption
is of 20%. Indians prefer to consume tea at least two times a day.
2. The domestic companies like Coffee Cafe Day that are home grown brands
dominate the retail coffee market, followed by Barista coffee and Qwikys Coffee.
3. The standard of living of people and per capita income of Indians is low. The Coffee
price of Tata Starbucks outlets is felt as a barrier for middle class income group to
have a cup of coffee. So, Tata Starbucks has to reframe the pricing model as per the
Indian standards and offer products at locally competitive prices.

12
4. The consumers are very conscious about their health. Due to increase in obesity,
diabetes, Blood pressure, heart attacks, people prefer to go for health drinks. There
is an opposition from many health groups worldwide on Starbucks that it sold high
calorie and high fat products to its consumers.
5. Visiting coffee outlets and cafes are not a regular habit among most of the Indians.
Instead they go occasionally.
6. Fast food chains like that of McDonalds, Dunkin Donuts, Burger King, etc., have
already diversified their products and offering quality coffee to compete with
Starbucks.
7. Rise in coffee prices are increasing pressure on the profit margins. So, Starbucks
need to address pricing issues for India, since demand is highly elastic.
8. There are many competitors like Barista, café coffee day, etc. in this sector for
Starbucks.

13
2.2PESTLE Analysis
1. Political Factors:
“India’s young are becoming world-class consumers, and multinationals are
taking note,” reads the sub header for an article titled “Hey, Big Spenders!” in the
August 2003 issue of TIME Magazine. This change can be attributed to many factors.
For one, the Indian economy went through a massive liberalization under the new
minority government of P.V. Narasimha Rao in 1991. Further, the current government’s
reform measures like approval to FDI in multi brand retail for up to 51% will surely add
up to these factors.
2. Economic Factors:
The factors like inadequate infrastructure, bureaucracy, regulatory and foreign
investment controls, the reservation of key products for small-scale industries, and high
fiscal deficits are constraining economic growth of India.
However, the liberalization measures taken in 1991 opened the economy to foreign
investment and trade: it dismantled important controls, lowered customs duties, and
devalued the currency: it virtually abolished licensing controls on private investment,
dropped tax rates, and broke public sector monopolies. Further, reforms have been seen
in retail industry with Indian government's approval on FDI up to 51% on multi brand
retail.
The country has recently become is a major exporter of software services and software
workers, and the information technology sector leads the strong growth pattern. With a
world changing from an industrial to an informational economy, India is bound to play a
monumental role in the future of the global industry.
PESTLE
Political Economic
Socio-
cultural
Technological Legal Environmental

14
3. Socio-Cultural Factors:
As job opportunities increase in India, money stays in the palms of the Indian
consumers enabling them to reinvest in the Indian economy. Attitudes towards money
are also changing. The mantra for the average Indian family, as in most of Asia, has
always been saving, but young Indians today, inspired by job opportunities, have
switched to spending extravagantly. The 13 attitude of the young generation is to enjoy
life and spend money.
However, India is a tea-based culture. Most of the Indians consumed tea at least twice a
day, in the morning and in the afternoon. According to market research studies, coffee
was mainly consumed in the urban areas (71%) and to a much lesser extent in the rural
areas (29%). The people in southern states of India largely consumed coffee. The people
in the northern states were generally not coffee drinkers, but drank coffee and
experimented with various flavors as a fashion statement.
The consumption of instant coffee and filter coffee was almost equal on the national
level. But region-wise, filter coffee was more popular in the south and the proportion of
instant coffee was very high in the non-south regions.
4. Technological Factors:
The coffee beans and tea need be bought from local Indian farmers in order to support
the local agricultural economy, save money in transportation and tariffs, and gain tax
benefits. Indians tend to take more cream in their coffee.
The association with the Tata Coffee Ltd for sourcing its Arabica Coffee would surely
help in the long run. Further, the skim milk option need not be offered in India because
dieting is not a commonly accepted practice in the country. Indians will feel that they
are being cheated out of their money if skim milk is put in their beverages. Indians also
like spices in their tea and coffee, especially ginger and black clove.
One of India’s favorite fruit flavors in mango, and in fact the mango is India’s national
fruit. The food segment needs to take care of vegetarians segment as they form the good
proportion of the target market.
However, Indians specially the affluent and young class will be delighted to have fast
and efficient Wi-Fi services at the cafe plus; people here love to be associated with their
traditional and rich heritage as well as its blending with modernity and this may be
reflected in the stores' ambience. The awareness about how varieties of coffee are
sourced, roasted, brewed, etc. needed to make people more loyal to coffee specially the
Starbuck's.

15
The inventory policy requires keeping the stores stocked but not overstocked to ensure
freshness of products. Better gauges of the numerical figures in the inventory policies
can be made after observing consumer trends. To begin with policies can be formulated
assuming an average of five hundred consumers per day.
5. Legal Factors:
Companies may be public or private but the common public is not allowed to buy shares
of the company and there can only be up to fifty shareholders. Import duties are applied
to almost all goods entering India.
The tariff system is based on the Harmonized System (HS) and tariffs are in the 40 to 60
percent range for basic raw materials, 60 to 100 percent for semi- processed goods, and
100 percent and above on finished and consumer goods. Shipments to India require a
commercial invoice, a packing list and bill of lading. A certificate of origin is not
required on imports originating in the United States. FDI approval though has come to
relaxation.
6. Environmental Factors:
Starbucks believe in the importance of caring for our planet and working with and
encouraging others to do the same. As a company that relies on an agricultural product,
it makes good business sense. It engages itself in recycling, energy management, water
conservation, green building, and in reducing carbon footprints wherever possible. With
these integrated environmental responsibilities, the company will obviously build its
image in the eyes of Indian Consumers as well. The ecological concerns regarding the
farming of Arabica coffee must also be addressed in order to ensure consistency in
productivity.

16
2.3 Five Forces Model
1. Intensity of rivalry
Porter's 5 Forces Analysis It is to alert that the Porter's five Forces of Coffee Wars In
India: Starbucks 2012 Case Solution belongs of the international entertainment industry
in the United States. The company has been engaged in offering the services in more
than ninety countries with the video as needed, items of streaming media and media
service provider.
The market where the Porter's Five Forces of Coffee Wars In India: Starbucks 2012
Case Help has actually been operating given that its creation has many market gamers
with the substantial market share and increased revenues. There is an extreme level of
competitors or competition in the media and entertainment industry, engaging
organizations to make every effort in order to retain the current customers through
providing services at budget-friendly or affordable costs. Porter's 5 Forces of Coffee
Wars in India: Starbucks 2012 Case Solution has been dealing with intense competitors
from the rival business providing as needed videos, standard broadcaster and sellers
offering DVDs. The main direct rival of Porter's Five Forces of Coffee Wars in India:
Starbucks 2012 Case Analysis is Amazon, since both of these business provide DVDs
on lease, for this reason contending in this domain for the comparable target market.
Soon, the strength of competition is strong in the market and it is very important for the
company to come up with special and ingenious offerings as the audience or customers
are more sophisticated in such modern-day technology period.
Porters 5
Forces of
Models
Intensity
of rivalry
Threats of
new
entrants
Threat of
substitutes
Bargaining
power of
buyer
Bargaining
power of
suppliers

17
2. Threats of new entrants
There is a high expense of entrance in the media and entrainment industry. The
entertainment industry needs a large capital amount as the business which are engaged
in offering home entertainment service have larger start-up expense, which includes:
 Legal cost.
 Marketing expense.
 Distribution cost.
 Licensing cost.
In contrast, the existing entertainment company has actually been extensively working
on their targeted segments with the particular expertise, which is why the risk of brand-
new entrants is low.
Another crucial factor is the intensity of competitors within the key market players in
the industry, due to which the new entrant think twice while entering into the market.
Likewise, the technology and trends in the media industry are developing on consistent
basis, which is adapted by market competitors and Porter's Five Forces of Coffee Wars
in India: Starbucks 2012 Case Solution. Despite the fact that, the brand-new entrant can
easily replicate the business model but what offers edge to market rivals and Porter's
Five Forces of Coffee Wars in India: Starbucks 2012 Case Analysis is benefit and
variety of readily available material. Gaining such competitive advantage would require
supplier agreements, capital expense and networking which would not be simple for the
new entrants to follow.
3. Threat of substitutes
The risk of substitutes in the market posture moderate risk level in media and the
entertainment market. The consumer might likewise engage in other leisure activities
and source of information as compared to watching media material and online
streaming.

18
4. Bargaining power of buyer
The dynamics of media and show business enables the customers to have high
bargaining power. The revenue and sales generated by company are based on the
customers placed in diverse areas all around the world. Also, the low cost of switching
allows the consumers to seek other media service providers and cancel their Porter's
Five Forces of Coffee Wars in India: Starbucks 2012 Case Analysis subscription, hence
increasing the business danger. Due to this, the company might not charge high rates for
services from the consumers, and it ought to keep the pricing technique according to
client need, with minimal increase in price.
5. Bargaining power of suppliers
The bargaining power of supplier is high force in the marketplace. This is because there
are few variety of suppliers who produce entertainment and media based material.
Because Porter's 5 Forces of Coffee Wars In India: Starbucks 2012 Case Help has
actually been contending versus the traditional distributor of home entertainment and
media, it requires to reveal higher versatility in arrangement as compared to the
traditional services. Likewise, the products is innovation based, the dependence of the
companies are increasing on continuous basis.

19
Chapter 3
Research Methodology
3.1 Introduction:
Research methodology is the systematic, theoretical analysis of the methods applied to a
field of study. It comprises the theoretical analysis of the body of methods and
principles associated with a branch of knowledge. Typically, it encompasses concepts
such as paradigm, theoretical model, phases and quantitative or qualitative techniques.
The systematic study of methods that are, can be, or have been applied within a
discipline or field of study.
Research methodology is very important part of the research. If research methodology is
not proper then research can be wrong. Methodology does not give any solutions but it
gives way to understanding, and interpreting and analysis to research or research
problems. Methodology gives ideas about methods used in research. Research
methodology is general outline of research in which ways research are going and
understanding.
3.2 Rationale of topic
This research is undertaken for purposes of strategic planning for study. This research is
in terms of performance in key of areas such as objectives of Study on word of mouth of
Tata Starbucks.
3.3 Type of Research Design
A research design is the set of methods and procedures used in collecting and analyzing
measures of the variables specified in the research problem research. Three type of
research design can be implemented namely exploratory research, descriptive research
and causal research. However we have conducted only exploratory research and
descriptive research for our project.
3.3.1 Exploratory research
When a problem has not been clearly defined we can use research to explore and
analyze the situation. This will help us to discover research problems. Exploratory
research does not give us an answer but it helps us to understand the situation better.
Exploratory research helps determine the data collection method and often relies on

20
secondary research (such as our literature review). The objective of exploratory research
is to gather preliminary information that will help define problems and suggest
hypothesis. Exploratory research on its own is not sufficient but it is essential for
conducting descriptive or causal research.
We have utilized secondary data analysis (conduct a literature review using past
research papers) to identify the factors that affect the word of mouth of Starbucks.
3.3.2 Descriptive research
This research is used to describe answers to research problems in detail. The answer
certain question, it can’t explain what caused a situation. Descriptive research helps to
determine the independent and dependent variables and it also helps to explain the
relationship between them. Descriptive research is also often known as Statistical
research.
We used questionnaire survey as a method for collecting data about the population
being studied. It helps in obtaining information that will be used to provide solution to
research problems.
3.4 Sources of data
Primary data: Primary data means data which has been collected by the researcher
directly from the respondents for the specific research work. Primary data is collected
form persons so there are chances of personal bias about some matters which does not
give clear idea about the results which affect our study. In our study we could not give
too much time so this one more limitations of time. Collections of primary data are not
always easy to collect, so many are not ready to give information on some critical or
personal matters. Data collection did on specific or selected area which create limit on
the study. This study is more focused on the customers only.
Secondary data: Secondary data means data which is already in existence, collected and
someone has obtained for specific purposes but reutilize by the researcher.
We used questionnaires survey to gather information about Tata Starbucks from the
sample of the total population who drink beverages of Tata Starbucks. We selected
survey method because it is an efficient, fast, accurate and inexpensive way of
collecting data.
After the questionnaires were design, we sent in our draft to our professor. After certain
changes the final draft was created and approved. After all the recommended and
required changes were made the questionnaires were ready for data collection.

21
The said research work is based on primary data. In primary data we have collected data
directly from people.
We have done our survey of Tata Starbucks by two ways i.e. online and offline method.
In online method we have used Google form for purpose of survey .Online method was
easy and also consumed less time, as we just have to send the link to all persons for
survey. In offline method we have used printed questionnaire for the survey. Offline
method was more time consuming than online method, as we have contacted different
persons and get the questionnaire filled
3.5 Sampling Plan
We distributed 300 sets of questionnaires to students at Assumption University,
Suvarnabhumi Campus. The questionnaire was about the word of mouth of Starbucks.
We determined our sampling plan as follows:
 Target population
We selected respondents by asking them whether they had tried beverages at Starbucks
before. One we made sure that they have been customers of Starbucks in the past, we
gave them the questionnaires to fill.
 Sample size
Here we were collected 188 responders.
 Sampling method
We used the non-probability sampling method; this is a non-randomization method. We
selected respondents based on convenience sampling or accidental sampling, whereby
we chose respondents who happened to be available at that particular time and place.
We chose respondents who were easy to find and were available around the researchers
(our group members), i.e. the students of Divaba Institute of Business Administration
3.6 Data Analysis Tools
Here we not used any specific statistical tools but here we used general tools of analysis
like percentage, comparison etc. So our analysis is generally descriptive.

22
3.7 Limitations of the Study
 This analysis is based on primary data so this data is costly than other data.
 Primary data is collected form persons so there are chances of personal bias about some
matters which does not give clear idea about the results which affect our study.
 It was a time consuming activity for study. And we have limited time for the study.
 Collections of primary data are not always easy to collect, so many are not ready to give
information on some critical or personal matters.
 Data collection did on specific or selected area which create limit on the study.

23
Chapter 4
DATA ANALYSIS
1. Gender
Gender No. of Person Responses in percentage (%)
Male 125 66%
Female 63 34%
The graph shown above is a result of survey from 188 peoples who have filled up the
online Questionnaire.
Both Male & Female fill up the questionnaire of study “Tata Starbucks”. In which we
found that 66% are Male and 34% are female. The most respondents are male, 66%.
Male
66%
Female
34%
Geneder
Male Female

24
2. Age
Age No. of Person Responses in Percentage (%)
Under 18 42 22%
18-25 Years 122 65%
26-40 Years 20 11%
Above 41 4 2%
There are different categories of people who have filled the questionnaire. 22% of the
people who have filled the questionnaire are below 18, 65% people are between 18-25 years
of age. 11% of people between 26-40 years, 2% of people are above 41.
42
122
20
4
0
20
40
60
80
100
120
140
Under 18 18-25 Years 26-40 Years Above 41
Age
Age

25
3. Occupation
Occupation No. of person Responses in percentage (%)
Student 118 63%
Employee 30 16%
Self employed 27 14%
Business Owner 13 7%
The people who have filled the questionnaire are of different occupations. Among them
63% are students, 16% are employee, 14% are self-employed, and 7% are business owner.
Student
63%
Employee
16%
Self Employed
14%
Businee Owner
7%
Occupation
Student Employee Self Employed Businee Owner

26
4. Monthly Income
Income No. of person Response in percentage (%)
0 – 10000 46 24%
10000 – 20000 41 22%
20000 – 25000 20 11%
25000 or above 14 7%
Unemployed 67 36%
As we, all know that not all people are having same income. Income affect the investing
capacity of the people.
0-10000
24%
10000-20000
22%
20000-25000
11%
25000 or above
7%
Unemployed
36%
Income
0-10000 10000-20000 20000-25000 25000 or above Unemployed

27
5. What do you like the most?
No. of person Response in percentage (%)
Coffee 118 63%
Tea 70 37%
Most preferred beverages among tea and coffee is coffee in our survey. 63% of People have
preferred coffee and 37% of people are gone with tea.
Coffee
63%
Tea
37%
Beverages
Coffee Tea

28
6. Do you like coffee of Tata Starbucks?
No. of person Responses in percentage (%)
Yes 162 86%
No 26 14%
In our survey we have asked question which was about coffee of Tata Starbucks and the
result which was came out as 86% of people has preferred coffee of Tata Starbucks and
14% of people have not.
Yes
86%
No
14%
Choice of coffee
Yes No

29
7. How many times do you visit Tata Starbucks?
Everyday 37 20%
Once in a Week 45 24%
Once in a Month 61 32%
Never 45 24%
Here we can see that people visit how many times to the Tata Starbucks and here is the
result 24% of people has selected the option [never], 20% of people has selected the option
[everyday], 32% of people has selected the [option once in month], and 24% of people has
selected the option [once in week]. And this is how the 100% result came out.
Everyday
20%
Once in a week
24%
Once in a month
32%
Never
24%
Visit of Tata Starbucks
Everyday Once in a week Once in a month Never

30
8. How do you get updated information about Starbucks?
Friends & Family 77 41%
Social media 77 41%
Magazine/Newspaper 23 12%
Brochure 11 6%
Here we have ask in our survey that from where you get the information about Tata
Starbucks. 6% of people says that they get information from [Brochure], 41% of people says
that they get information form [Friends and family], 41% of people says that they get
information from [Social media], 12% of people says that they get information from
[Magazine & Newspaper]. Thus this is how we got 100% result.
Friends & Family
41%
Social media
41%
Magazine/Newspaper
12%
Brochure
6%
Information about Tata Starbucks
Friends & Family Social media Magazine/Newspaper Brochure

31
9. How much time did you spend at Tata Starbucks?
0-30 Minutes 87 46%
30-45 Minutes 72 39%
45-60 Minutes 21 11%
60 Minutes or more 8 4%
Here we can see that 46% of people spend 0-30 minutes, 39% of people spend 30-45
minutes, 11% of people spend 45-60 minutes, 4% of people spend 60 minutes or more than
that.
0-30 Minutes
46%
30-45 Minutes
39%
45-60 Minutes
11%
60 minutes or more
4%
Time spend at store
0-30 Minutes 30-45 Minutes 45-60 Minutes 60 minutes or more

32
10. What kind of beverages do you like the most at Tata Starbucks?
In the questionnaire we have provided picture of menu card of Tata Starbucks. And we get
most liked products respondent are as under,
1. Coffee
2. Java Chip
3. Chocolate cappuccino
4. Mocha
5. Cold Coffee
6. Espresso and Coffee
7. Vanila cream
8. Cold brew
9. Black tea
10. Double chocolate cappuccino
Hence we can say that these things are the most favorable products by consumer of Tata
Starbucks is coffee

33
11. Did you find Tata Starbucks Service to be prompt?
Yes 163 87%
No 25 13%
In the above chart we can see that how much percentage services is to be prompt by
customer of Tata Starbucks. 87% of people has selected option YES and agree with
question. Rest 13% of people has disagree for the services.
Yes
87%
No
13%
Service of Tata Starbucks
Yes No

34
12. Did the bar tender greets you with a smile?
Yes 171 91%
No 17 9%
We can see the result of above question that 91% of people has agree with the question and
said yes the bar tender greets them with a smile and rest 9% of people has choose the option
NO.
Yes
91%
No
9%
Greets by bar tender
Yes No

35
13. Does Tata Starbucks advice you to choose alternate product or kit for the same which
you order?
Yes 145 77%
No 43 23%
For the above mentioned question 77% of people said YES and conclude their answer as
they give them advice to choose them alternate kit and products and rest 23% of people has
choose option NO and conclude their answer as they did not get any kind of advice to
choose some kit or else.
Yes
77%
No
23%
Advice for choosing product kit
Yes No

36
14. Do you think that Tata Starbucks drinks/coffee/tea etc. are value for money?
Yes 100 53%
No 25 13%
Maybe 63 34%
In our survey we have asked for product that they are value for money or not.
Result we can see that 53% of people has choose option YES, 13% of people has choose
option NO, and 34% of people has choose option MAYBE.
Yes
53%
No
13%
Maybe
34%
Products are value for money or not
Yes No Maybe

37
1 2 3 4 5
Strongly Agree Agree Neutral Agree Strongly Agree
15. How would you rate your drinks satisfaction?
1 18 10%
2 14 7%
3 23 12%
4 45 24%
5 88 47%
Here we can see the drink satisfaction of Tata Starbucks customer.
10% of people has rated 1 out of 5, 7% of people has rated 2 out of 5, 12% of people has
rated 3 out of 5, 24% of people has rated out of 5, and 47% of people has rated 5 out of 5.
Thus is how 100% has been done.
1
10%
2
7%
3
12%
4
24%
5
47%
Rate of drinks satisfaction
1 2 3 4 5

38
16. How would you rate the ambience at Tata Starbucks? E.g. lighting, music, etc.?
1 12 6%
2 12 6%
3 31 17%
4 52 28%
5 81 43%
Ambience rating of Tata Starbucks
As we can see in the above chart that 6% of people has rated 1 out of 5, 6% of people has
rated 2 out of 5, 17% of people has rated 3 out of 5, 28% of people has rated 4 out of 5, and
43% of people has rated 5 out of 5. Thus this is how 100% has been done for ambience at
Tata Starbucks.
1
6% 2
6%
3
17%
4
28%
5
43%
Rate of ambience at tata starbucks
1 2 3 4 5

39
17. How would you rate the environment at Tata Starbucks?
1 11 6%
2 9 5%
3 33 17%
4 51 27%
5 84 45%
The above given chart is for environment at Tata Starbucks
As we can see in the above chart that 6% of people has rated 1 out of 5 for the environment,
5% of people has rated 2 out of 5 for the environment, 17% of people has rated 3 out of 5
for the environment, 27% of people has rated 4 out of 5 for the environment, 45% of people
has rated 5 out of 5 for the environment.
1
6% 2
5%
3
17%
4
27%
5
45%
Rate of enviornment at Tata starbucks
1 2 3 4 5

40
18. How would you rate the Tata Starbucks staff?
1 10 5%
2 14 7%
3 25 13%
4 46 25%
5 93 50%
Tata Starbucks staff rating
As mention in the above chart and our survey 5% of people has rated 1 out of 5 to the Tata
Starbucks staff, 7% of people has rated 2 out of 5 to the staff of Tata Starbucks, 13% of
people has rated 3 out of 5 to the staff of Tata Starbucks, 25% of people has rated 4 out of 5
to the staff of Tata Starbucks, and 50% of people has rated 5 out of 5 to the staff of Tata
Starbucks.
1
5% 2
7%
3
13%
4
25%
5
50%
Rate for staff
1 2 3 4 5

41
19. Do you agree that Tata Starbucks is original in terms of products & services?
1 11 6%
2 14 7%
3 19 10%
4 48 26%
5 96 51%
As we can see in the above chart that how the people/customers has rated to the products
and services of Tata Starbucks.
6% of people has rated 1 out of 5 for the products and services of Tata Starbucks, 7% of
people has rated 2 out of 5 for the products and services of Tata Starbucks, 10% of people
has rated 3 out of 5 for the products and services of Tata Starbucks, 26% of people has rated
4 out of 5 for the products and services of Tata Starbucks, 51% of people has rated for
products and services of Tata Starbucks.
1
6% 2
7%
3
10%
4
26%
5
51%
Rate for product and service
1 2 3 4 5

42
Conclusion
Conclusion from Descriptive Analysis
Our survey questionnaire had some interesting findings and they have been concluded
below:
 Coffee was ranked as the most important factor to be considered while purchasing
products/beverages of Tata Starbucks, by a majority of our respondents followed by
quality and price respectively.
 Starbucks was the brand that came first in the minds of most of the respondents
when we talk about coffee. Also most of our respondents prefer drinking coffee at
Starbucks than other beverages and visit the store once in a month.
 From a crosstab to determine the relationship between brand that comes first to mind
and liking for American Brands we concluded that Starbucks is the first brand that
comes to mind of most of our respondents whether they like or dislike American
brands.
 From a crosstab to determine the relationship between source of information we
concluded that most respondents get updated information about Starbucks from their
friends/family and social-media networks.

43
Bibliography
https://en.wikipedia.org/wiki/Tata_Starbucks
https://in.linkedin.com/company/starbucks-india/
http://www.starbucks.com
https://www.starbucks.in/media/1-
TheTatagroupandStarbucksCoffeeCompanyStrengthenGlobalPartnershipwithMultipleNewCom
mitments_tcm87-16176.pdf
https://www.proactiveinvestors.com/companies/news/75705/starbucks-and-tata-coffee-sign-
strategic-alliance-in-india-11413.html

44
Questionnaire
Tata Starbucks
Feedback regarding your experience (like Quality, atmosphere, behavior etc.,) at Tata
Starbucks.
1. Email
2. What is your gender?
Male
Female
3. What is your age?
Under 18
18 - 25 Years
26 - 40 Years
Above 41
4. What is your occupation?
Student
Employee
Self-employed
Business owner

45
5. What is your Monthly income?
0 - 10000
10000 - 20000
20000 - 25000
25000 or above
Unemployed
6. What do you like most?
Coffee
Tea
7. Do you like coffee of Tata Starbucks?
Yes
No
8. How many times do you visit Tata Starbucks?
Everyday
Once in a week
Once in a month
Never
9. How do you get updated about Tata Starbucks?
Friends & Family
Social Media
Magazine/Newspaper
Brochure

46
10. How much time did you spend at Tata Starbucks?
0-30 Minutes
30-45 Minutes
45-60 Minutes
60 Minutes or more
11. What kind of beverages do you like the most at Tata Starbucks? (Choose from these
menu.)

47
12. Did you find Tata Starbucks service to be prompt?
Yes
No
13. Do the bar tender greets you with a smile?
Yes
No
14. Does Tata Starbucks advice you to choose alternate product or kit for the same which
you order?
Yes
No
15. Do you think that Tata Starbucks drinks/coffee/tea etc. are value for money?
Yes
No
Maybe
16. Write in your word, why do you choose Tata Starbucks over some of the other
competing coffee companies? (Write your opinion or response in the space given
below.)

48
Rating
5 = strongly agree
4 = Agree
3 = Neutral
2 = Disagree
1 = strongly disagree
1 2 3 4 5
17. How would you rate your drinks satisfaction?
18. How would you rate the ambience at Tata Starbucks? E.g.
lighting, music, etc.?
19. How would you rate the environment at Tata Starbucks?
E.g. cleanliness, behavior
20. How would you rate the Tata Starbucks staff?

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