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Starbucks
Starbucks was founded in 1971 in Seattle, Washington and has grown to become the largest coffeehouse company in the world with over 16,000 stores globally. The company sells coffee drinks, teas, pastries, and coffee beans. Starbucks aims to provide a relaxing social atmosphere while offering high-quality products. It has pursued an aggressive expansion strategy but may face risks if changes to its menu and operations are not received well by customers.
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Starbucks
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- 2. The Frappuccinos Introduction toStarbucks Company started in 1971 in Seattle, Washington Products sold include: - beverages - pastries - whole coffee beans - coffee-related retail items
- 3. Starbucks isthe largest coffeehouse company in the world , with over 16,858 stores in 50 countries, including over 11,000 in the United States, over 1000 in Canada, and over 700 in the UK. The Frappuccinos
- 4. Starbucks sellsdrip brewed coffee, espresso-based hot drinks, other hot and cold drinks, coffee beans, salads, hot and cold sandwiches , pastries and snacks The Frappuccinos
- 5. Mission “To inspire andnurture the human spirit-one person, one cup and one neighborhood at a time”. The Frappuccinos
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- 8. The Frappuccinos Starbucks CorporateStrategy Maximize market penetration Provide a relaxing, attractive social atmosphere Offer high-quality products Create a great working environment Achieve profitability
- 9. Starbucks announcedthat the company hopes to enter the energy drink market. Pre-ground beans will no longer be used, so that the grinding of whole bean coffee will "bring aroma, romance and theater" to American stores.. The Frappuccinos
- 10. The companyalso announced the acquisition of the Coffee Equipment Company,the manufacturer of the Clover Brewing System. They are currently test marketing this "fresh-pressed" coffee system at six Starbucks locations; three in Seattle, and three in Boston The Frappuccinos
- 11. In June2009, the company announced that it will be overhauling its menu and selling salads and baked goods without high- fructose corn syrup or artificial ingredients. The move is expected to attract health- and cost-conscious consumers and will not affect prices. The Frappuccinos
- 12. The Frappuccinos Starbucks SWOTAnalysis Strengths – Largest market share in industry – Differentiated atmosphere Weaknesses – Aggressive expansion could lead to managerial / financial problems Opportunities – Whole bean sales in supermarkets Threats – Lack of ownership of coffee farms can lead to price fluctuations
- 13. The Frappuccinos The useof IT strategy at Starbucks Corporate IT System Individual Stores Individual Stores Sales, Inventory, Staffing Sales, Inventory, Staffing Individual Stores Inventory, Orders, Transfers Vendors, Distributors, Mgmt., Channel Members Orders, Budgets, Future Sales
- 14. Market strategy buyingout competitors' leases, intentionally operating at a loss, and clustering several locations in a small geographical area Starbucks has agreed to a partnership with Apple to collaborate on selling music as part of the "coffeehouse experience". The Frappuccinos
- 15. The Frappuccinos Company Financial Performance(1998 FY) -10% -5% 0% 5% 10% 15% 20% 25% 30% Net Profit Margin ROE ROA Debt/Equ 12-Mo Rev Growth Industry Starbucks
- 16. The Frappuccinos Company Financial Performance(1998 FY) Revenues $1,308.7 million (% of Sales) Gross Margin 195.7 million 15% Pre-tax Profit Margin 116.4 million 8.9% Net Income 68.4 million 5.2% Return-on-Assets 8.7% Return-on-Equity 11.0% Debt-to-Equity 0.04 12 mo. Revenue Growth 28.4%
- 17. The Frappuccinos Potential Risks Customers may not react positively to the changes being made Not enough available employees to meet re- aligned hiring needs Costs associated with planned change
- 18. The Frappuccinos Wrap-Up Starbucksis the market leader in a growing market segment Starbucks is known world-wide for its high- quality food products and differentiated “Third Place” atmosphere
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