Starbucks Corporation is a global coffee and snacks retailer with over 19,000 stores worldwide. The document provides a strategic analysis of Starbucks and the retail coffee industry it operates in. It finds that the industry is mature with moderate barriers to entry. While there are many substitutes for coffee, Starbucks differentiates itself through premium products and store experience. The analysis also examines Starbucks' strong market position and competitive strategies.
A Fortune 500 company, Starbucks share prices reached its peak in 2006 and declined unexpectedly in 2008. Although its business has picked up in 2011 with an increase in operating profits, Starbucks has lost its market leader position to Costa, a chain coffee shop business owned by Whitbread plc. Starbucks’ strategic issues are its decrease in market share, negative brand perception that was invoked by its competitors and its devalued Starbucks’ Experience that was its competitive advantage. A situational analysis of Starbucks was conducted to indicate possible opportunities and threats. Internal analysis and competitor analysis was conducted simultaneously to identify Starbucks distinctive capabilities and weaknesses against competitors. Strategic options such as Market Penetration, Product Development and Market development were assessed for their suitability, acceptability and feasibility. Strategic choices that unravel three issues that Starbucks is challenged with are presented in the report.
A free version of Starbucks Corporation SWOT analysis 2016. To get the full presentation buy the SWOT here: https://www.strategicmanagementinsight.com/swot-analyses/starbucks-swot-analysis.html
All aspect of strategic management of Stabucks.
If you would like to download these slides, send me via: nguyenpuyen91@gmail.com with your purpose of download.
A Fortune 500 company, Starbucks share prices reached its peak in 2006 and declined unexpectedly in 2008. Although its business has picked up in 2011 with an increase in operating profits, Starbucks has lost its market leader position to Costa, a chain coffee shop business owned by Whitbread plc. Starbucks’ strategic issues are its decrease in market share, negative brand perception that was invoked by its competitors and its devalued Starbucks’ Experience that was its competitive advantage. A situational analysis of Starbucks was conducted to indicate possible opportunities and threats. Internal analysis and competitor analysis was conducted simultaneously to identify Starbucks distinctive capabilities and weaknesses against competitors. Strategic options such as Market Penetration, Product Development and Market development were assessed for their suitability, acceptability and feasibility. Strategic choices that unravel three issues that Starbucks is challenged with are presented in the report.
A free version of Starbucks Corporation SWOT analysis 2016. To get the full presentation buy the SWOT here: https://www.strategicmanagementinsight.com/swot-analyses/starbucks-swot-analysis.html
All aspect of strategic management of Stabucks.
If you would like to download these slides, send me via: nguyenpuyen91@gmail.com with your purpose of download.
Management 315: International Management, Professor In Hyeock Lee
Loyola University Chicago Spring 2013
This case study analyzes Starbuck's overall performance as a multinational enterprise using the company's revenue data, 4 distances, firm specific advantages, country specific advantages, foreign direct investment, and much more.
This is a comparative strategic study of the different strategies that have led Tim Hortons and Starbucks to their current positions in the Canadian Market and based on the industry analysis and the internal organizational analysis, How they can move forward in this saturating industry. This takes into account the likely economic conditions that would impact the growth as well as the upcoming tends in the consumer base for this industry.
Management 315: International Management, Professor In Hyeock Lee
Loyola University Chicago Spring 2013
This case study analyzes Starbuck's overall performance as a multinational enterprise using the company's revenue data, 4 distances, firm specific advantages, country specific advantages, foreign direct investment, and much more.
This is a comparative strategic study of the different strategies that have led Tim Hortons and Starbucks to their current positions in the Canadian Market and based on the industry analysis and the internal organizational analysis, How they can move forward in this saturating industry. This takes into account the likely economic conditions that would impact the growth as well as the upcoming tends in the consumer base for this industry.
Digital Transformation ( DT) – the use of technology to radically improve and differentiate performance or reach of enterprises is becoming a hot topic for companies across the globe. Executives in all industries are using digital advances such as Analytic, Mobility, Social media and smart embedded devices and improving their use of traditional technologies such as ERP – to change customer relationships, internal processes, and value propositions. We continue to see how fast digital technology disrupted media industries in the past decade and it now spreading to all businesses irrespective of the domain and sectors.
How can top / senior management successfully lead digital transformation? While we all know and urge the team to get started on the digital transformation journey , few tell how to do it. This book gives a clear “ How” part .
I have also given in the summary few good case studies where digitization has impacted the business outcomes like Burberry , Asian Paints, Nike, Codelco, Starbucks , UPS etc.
The how part –Leading digital transformation
• Sharing a digital transformation vision across the enterprise ( not in piece mail – all businesses across the group need to envision the journey and be in sync)
• Gaining critical mass – inclusiveness
• Frame the digital challenges
• Focus investment on resources
• Sustaining the transformation
An excellent one to read.
Starbucks Case Study : Building Sustainable Supply ChainRiri Kusumarani
This presentation is made by my classmates for Supply Chain Class. Discussion focus on C.A.F.E strategy used by Starbucks. Sustainable supply chain is one of the key issue especially about ethical coffee trade.
National Association of Scientists (NAU) - founded in 2007, is a non-profit, public organization. Association members are scientists, researchers and students from all over Russia and the CIS countries and Asia. Association of scientists published articles, reflect the actual results of basic and applied research, advanced scientific technologies, scientific and methodical work and designed in accordance with the rules established by the editorial board of the journal
Strategic Analysis Of Starbucks Corporation
Strategic Analysis Of Starbucks Corporation
By: Nithin Geereddy (ID: 80842082)
Strategic Analysis Of Starbucks Corporation
1) Introduction:
Starbucks Corporation, an American company founded in 1971 in Seattle, WA, is a premier roaster, marketer and
retailer of specialty coffee around world. Starbucks has about 182,000 employees across 19,767 company
operated & licensed stores in 62 countries. Their product mix includes roasted and handcrafted high-
quality/premium priced coffees, tea, a variety of fresh food items and other beverages. They also sell a variety of
coffee and tea products and license their trademarks through other channels such as licensed stores, grocery and
national foodservice accounts.
1
Starbucks also markets its products mix with other brand names within its
portfolio of companies, which include Teavana, Tazo, Seattle’s Best Coffee, Starbucks VIA, Starbucks
Refreshers, Evolution Fresh, La Boulange and Verismo. Starbucks had total revenue of $14.89 billion as of
September 29
th
, 2013.
2
2) External Environment Of The Retail Market For Coffee & Snacks:
2.1) Industry Overview and Analysis:
Starbucks primarily operates and competes in the retail coffee and snacks store industry. This industry
experienced a major slowdown in 2009 due to the economic crisis and changing consumer tastes, with the
industry revenue in the US declining 6.6% to $25.9 billion. Before this, the industry had a decade of growth
consistent. Due to the economic slump, consumers spent less on luxuries like eating out, choosing to purchase
low-price items instead of high-priced coffee drinks due to shrinking budgets.
3
The industry grew at a low
annualized average growth rate of 0.9% from 2008 till 2013 with current industry revenues at $29 billion in the
US. The industry is now forecasted to grow at an annualized rate of 3.9% over the next five years, with a potential
to reach $35.1 billion revenues in the US. This growth would be mainly driven by an improving economy,
increase in consumer confidence and expanding menu offerings within the industry. Starbucks dominates the
industry with a market share of 36.7%, Dunkin Brands with 24.6% and other competitors like McDonalds, Costa
Coffee, Tim Horton’s etc. taking the rest as shown in Appendix 1.
4
2.2) Industry Life Cycle and Market Share Concentration:
This industry is in a mature stage with a medium level concentration. Starbucks and Dunkin Brands make up
more than 60% of the market share (Appendix 1), giving them considerable market power in determining industry
trends. Industry Structure is given in Appendix 3.
2.3) Industry Demand Determinants and Profitability Drivers:
The industry’s demand for premium coffee and snack products are mainly driven by a number of factors which
include disposable inc.
Strategic Analysis Of Starbucks Corporation Strateg.docxrjoseph5
Strategic Analysis Of Starbucks Corporation
Strategic Analysis Of Starbucks Corporation
By: Nithin Geereddy (ID: 80842082)
Strategic Analysis Of Starbucks Corporation
1) Introduction:
Starbucks Corporation, an American company founded in 1971 in Seattle, WA, is a premier roaster, marketer and
retailer of specialty coffee around world. Starbucks has about 182,000 employees across 19,767 company
operated & licensed stores in 62 countries. Their product mix includes roasted and handcrafted high-
quality/premium priced coffees, tea, a variety of fresh food items and other beverages. They also sell a variety of
coffee and tea products and license their trademarks through other channels such as licensed stores, grocery and
national foodservice accounts.
1
Starbucks also markets its products mix with other brand names within its
portfolio of companies, which include Teavana, Tazo, Seattle’s Best Coffee, Starbucks VIA, Starbucks
Refreshers, Evolution Fresh, La Boulange and Verismo. Starbucks had total revenue of $14.89 billion as of
September 29
th
, 2013.
2
2) External Environment Of The Retail Market For Coffee & Snacks:
2.1) Industry Overview and Analysis:
Starbucks primarily operates and competes in the retail coffee and snacks store industry. This industry
experienced a major slowdown in 2009 due to the economic crisis and changing consumer tastes, with the
industry revenue in the US declining 6.6% to $25.9 billion. Before this, the industry had a decade of growth
consistent. Due to the economic slump, consumers spent less on luxuries like eating out, choosing to purchase
low-price items instead of high-priced coffee drinks due to shrinking budgets.
3
The industry grew at a low
annualized average growth rate of 0.9% from 2008 till 2013 with current industry revenues at $29 billion in the
US. The industry is now forecasted to grow at an annualized rate of 3.9% over the next five years, with a potential
to reach $35.1 billion revenues in the US. This growth would be mainly driven by an improving economy,
increase in consumer confidence and expanding menu offerings within the industry. Starbucks dominates the
industry with a market share of 36.7%, Dunkin Brands with 24.6% and other competitors like McDonalds, Costa
Coffee, Tim Horton’s etc. taking the rest as shown in Appendix 1.
4
2.2) Industry Life Cycle and Market Share Concentration:
This industry is in a mature stage with a medium level concentration. Starbucks and Dunkin Brands make up
more than 60% of the market share (Appendix 1), giving them considerable market power in determining industry
trends. Industry Structure is given in Appendix 3.
2.3) Industry Demand Determinants and Profitability Drivers:
The industry’s demand for premium coffee and snack products are mainly driven by a number of factors which
include disposable inc.
Starbucks India or it can be called as Tatabucks. As Starbucks Corporation and Tata Global Beverages announced 50:50 joint venture called Tata Starbucks Ltd. in January 2012 which operate and own outlets branded Starbucks “A Tata Alliance”. An agreement was also signed between Starbucks and Tata coffee that coffee would 100% locally sourced and roasted
External and Internal Analysis 8Extern.docxgitagrimston
External and Internal Analysis 8
External and Internal Environmental Analysis
STR/581
Professor Alfonso Rodriguez
July 30, 2014
Sheila Medina
Introduction
Coffee has become an integral part of the lives of numerous people. In 1971, Starbucks coffee opened its first coffee shop in the Pike Place Market in Seattle, Washington. Now, according to research “Starbucks Corporation is the leading retailer, roaster and brand of specialty coffee in the world, with more than 6,000 retail locations in North America, Latin America, Europe, the Middle East and the Pacific Rim” (www.investor.starbucks.com). Starbucks aims to be the consumer’s favorite coffee shop and to achieve this the company focused on customer satisfaction as well as company advancement. Therefore, it is important to act based on what is written in Starbucks mission, value and vision statement, “To inspire and nurture the human spirit-one person, one cup, and one neighborhood at a time” (www.starbucks.com).
A review of Starbucks financial reports has identified an increase in revenue over the past few years. However, this increase in revenue doesn’t account for the increase in profits. The profit increase is not as high as it could be due to external factors such as other coffee shops and the increase in amount of competition. This report aims to identify the different internal and external environment factors attributing to the changes in Starbucks external environment by utilizing several different analyses.
SWOT Analysis
Strengths
Starbucks possesses several main strengths including their high visibility being located in high traffic areas, quality of service and products and their established brand loyalty. Starbucks remains an established leader being the number one known coffee house in the world while possessing a competent workforce, providing quality service, and continuing financial soundness. They also are known for their strong internal and external relationships with their suppliers.
Weakness
Weaknesses that Starbucks must address include: Product affordability and pricing, coffee beans price is the major influence over the firms profits, maintaining the positive public opinion of their products, avoiding any negative publicity, and remaining connected to their customers. Starbucks must also consider the fact they have expanded domestically and internationally resulting in saturation of the markets. They are also a non-smoking facility alienating some customers from purchasing coffee or other products from their store.
Opportunities
Opportunities include the ability for Starbucks to enter into different and new markets,
partnership opportunities with businesses, growing acceptance and customer satisfaction, and increase different product offerings. Starbucks must strive to continue expanding their products and food service to remain competitive and reach other consumers. Another option would be for Starbucks to allow consumers to order t ...
Running head: STEELNUTRIDRINK 1
STEELNUTRIDRINK 2
SteelNutridrink Non-Alcoholic Beverage Company
Kizzie Griffin
Dr. Vanessa Graham
BUS 599
Strayer University
7/18/2017
Company and its significance
The company in question is Steel Nutri-drink Non-Alcoholic Beverage Company. The company will be manufacturing, processing and distributing the non-alcoholic beverage to the beverage markets. The rationale and foundation behind the creation, manufacturing and processing of the Steel Nutri-drinkis based on the motivation and need to provide a drink that gives the customer value for their money, instantaneous energy, is refreshing and still healthy. Other companies operating in the market have not managed to satisfy these needs of consumers. This is based on the fact that other drinks contain a lot of calories and sugars that may lead to obesity and other related health complications and are also costly at the same time. All areas that other competitors have not tapped into will be fully taken care of by Steel Nutri-drink.
Mission Statement
The mission statement for the company is “To be a global leader in the provision of efficient and timely energy drinks for all our customers, provide value for their money and achieve sustainability for the environment and all our workers.” The mission statement enables the company to remain focused and committed to achieving its goals and achieve consumer satisfaction. This will also enable it work towards maintaining the competitive edge in the highly competitive beverage markets. The provision of efficient and timely energy drinks gives the company direction. This reminds workers in the organization why the company is in existence. This is what will make the organization to be successful. Offering customers value will act as a “North Star,” which keeps each and every worker clear on the direction of Steel Nutri drink. Efficiency and value will help focus the future of the company. The mission will tell workers of the company what they are doing today as well as what they will do in the future.
The trends in the non-alcoholic beverage industry
There are some changes that are being experienced in the beverage market. Among the changes is the growth of energy, water, and sports drinks brands. Directing attention to only carbonated drinks is now a thing of the past. Much effort by organizations is directed towards producing and selling healthy beverages (Granato, Branco, Nazzaro, Cruz, & Faria, 2010). The other trend is reworking recipes. Most brands that have been in market for a long time now have to be reformulated. They have to be replaced with revamped version as well as have few calories. Also, there is a shift towards having smaller cans and bottles. Having smaller cans and bottles makes the players in the non-alcoholic be ...
Running head: STARBUCKS 1
STARBUCKS 2
Starbucks Research
ASSIGNMENT #2
Starbucks is recognized as the world largest coffee house chain with more than 20,000 locations in the entire world. Since its establishment in 1971, this firm has been offering hot and cold beverages especially coffee and snacks. In recent times, this firm has increased its efforts towards selling branded goods like packaged coffee beans, mugs, and other gifts (3). This paper is therefore aimed at discussing the strengths and weaknesses of this firm, the tactic that this firm needs to choose to ensure that there is maximum use of its advantage as well as the tact it can use to fix the weakness. Other sections to be discussed in the paper include the tangible and the intangible resources, the core abilities, and the core competencies; two segments of the general environment that is likely to influence on Starbucks; the forces of competition; how to improve to address its ability in the near future to overcome the competition; the greatest external threat; and the greatest opportunity presented to Starbucks.
The strengths and weaknesses
The first strength is related to the quality, profitability, and ethicality. This firm has established itself as the premium coffee house chain despite the existence of the global presence especially firms producing fast food. The products produced by Starbuck are excellent in terms of quality, environmentally friendly, and consistent between regions. The next strength is related to the effectiveness and re-investment strategies used by the firm and this implies that the profit made by this firm is going straight to the expansion of the business and this is why this firm is increasing its chains all over the world. This organization is also treating its employee. It is among the top 100 firms according to the Fortunes Top 100 Places to work for due to the manner, in which it treats its employees.
With regard to its weaknesses, this firm is having a high price point and this means that many customers are being prevented from visiting this firm to make their purchase. Another weakness is related to the lack of over uniqueness of its products. This firm does not have a unique market and this, therefore, implies that it provides products, which are similar to the majority of those, which are being provided by other firms.
How to take maximum advantage of the strength and fixing of the weakness
One of the strengths of Starbucks is related to its quality, profitability, and ethicality. This, therefore, implies that the majority of the customers get attracted to the products being produced by this firm. Therefore Starbuck can take advantage of this strength to increase the prices since the majority of the customers will be willing to pay. ...
1
SPACE Matrix
Below you will find a Strategic Position and Action Evaluation Matrix (SPACE Matrix) for Starbucks Coffee Company with two of their competitors, McDonalds and Maxwell House.
Based on the space matrix and previous matrices and reviewing the 2021 Starbucks 10-K and other financial documents, Starbucks is clearly in the aggressive quadrant, and competing well against its competition considering its smaller product mix, and more targeted market. It has a very strong financial position (FP) due to a low D/E ratio, and high current ratio and a high inventory turnover. Starbucks stability position is reflective of the covid pandemics, and the rising inflations pressures, as well as a low barrier to entry for competition, and a higher barrier to entry for Starbucks into established coffee cultures and markets.
Starbucks competitive position is very good, they are higher they the coffee suppliers like Maxwell House, and on the heels of larger corporations like McDonalds. As a note, they have no single worldwide competitor with a product mix close to theirs, so McDonalds, even though a fast food restaurant chain, is considered a competitor with their McCafé offerings. So with a smaller product mix Starbucks is in a very competitive position relative to McDonalds. Its Industry position (IP) is quite high, and it is considered the leader in the coffee industry.
With Starbucks being in the aggressive quadrant, there are a few recommendations to consider. Starbucks should accelerate its growth plans in the markets in which they lead, the USA, Canada, and China to maintain and expand its lead over the competition. This recommendation is based on the relative lack of barriers to entry into their core coffee business, and competitive pressures from the competition.
Starbucks should also consider increasing its product mix and quality and remarketing/repositioning stores as a defensive act to not lose market share to competitors that offer equal quality coffee products, but a greater mix of other food-related products. This should include local food offerings in markets that they are struggling with such as EMEA.
Starbucks should also look to expand its involvement in the Global Coffee Alliance with Nestle as this will expand its global reach. Starbucks has expanded its social responsibility with increased investment in its partners, Starbucks refers to its employees as partners, by advancing social and racial equality, and focusing on partner retention. It has integrated social responsibility as the core of its purpose and “our reason for being.” They have also expanded environmental sustainability programs by declaring a bold aspiration to become planet positive by 2050. Starbucks needs to expand this program worldwide, beyond the markets that they lead to truly show that they truly are committed.
Grand Strategy Matrix
Below you will find a Grand Strategy Matrix for Starbucks Coffee C.
June 3, 2024 Anti-Semitism Letter Sent to MIT President Kornbluth and MIT Cor...Levi Shapiro
Letter from the Congress of the United States regarding Anti-Semitism sent June 3rd to MIT President Sally Kornbluth, MIT Corp Chair, Mark Gorenberg
Dear Dr. Kornbluth and Mr. Gorenberg,
The US House of Representatives is deeply concerned by ongoing and pervasive acts of antisemitic
harassment and intimidation at the Massachusetts Institute of Technology (MIT). Failing to act decisively to ensure a safe learning environment for all students would be a grave dereliction of your responsibilities as President of MIT and Chair of the MIT Corporation.
This Congress will not stand idly by and allow an environment hostile to Jewish students to persist. The House believes that your institution is in violation of Title VI of the Civil Rights Act, and the inability or
unwillingness to rectify this violation through action requires accountability.
Postsecondary education is a unique opportunity for students to learn and have their ideas and beliefs challenged. However, universities receiving hundreds of millions of federal funds annually have denied
students that opportunity and have been hijacked to become venues for the promotion of terrorism, antisemitic harassment and intimidation, unlawful encampments, and in some cases, assaults and riots.
The House of Representatives will not countenance the use of federal funds to indoctrinate students into hateful, antisemitic, anti-American supporters of terrorism. Investigations into campus antisemitism by the Committee on Education and the Workforce and the Committee on Ways and Means have been expanded into a Congress-wide probe across all relevant jurisdictions to address this national crisis. The undersigned Committees will conduct oversight into the use of federal funds at MIT and its learning environment under authorities granted to each Committee.
• The Committee on Education and the Workforce has been investigating your institution since December 7, 2023. The Committee has broad jurisdiction over postsecondary education, including its compliance with Title VI of the Civil Rights Act, campus safety concerns over disruptions to the learning environment, and the awarding of federal student aid under the Higher Education Act.
• The Committee on Oversight and Accountability is investigating the sources of funding and other support flowing to groups espousing pro-Hamas propaganda and engaged in antisemitic harassment and intimidation of students. The Committee on Oversight and Accountability is the principal oversight committee of the US House of Representatives and has broad authority to investigate “any matter” at “any time” under House Rule X.
• The Committee on Ways and Means has been investigating several universities since November 15, 2023, when the Committee held a hearing entitled From Ivory Towers to Dark Corners: Investigating the Nexus Between Antisemitism, Tax-Exempt Universities, and Terror Financing. The Committee followed the hearing with letters to those institutions on January 10, 202
Unit 8 - Information and Communication Technology (Paper I).pdfThiyagu K
This slides describes the basic concepts of ICT, basics of Email, Emerging Technology and Digital Initiatives in Education. This presentations aligns with the UGC Paper I syllabus.
The French Revolution, which began in 1789, was a period of radical social and political upheaval in France. It marked the decline of absolute monarchies, the rise of secular and democratic republics, and the eventual rise of Napoleon Bonaparte. This revolutionary period is crucial in understanding the transition from feudalism to modernity in Europe.
For more information, visit-www.vavaclasses.com
Operation “Blue Star” is the only event in the history of Independent India where the state went into war with its own people. Even after about 40 years it is not clear if it was culmination of states anger over people of the region, a political game of power or start of dictatorial chapter in the democratic setup.
The people of Punjab felt alienated from main stream due to denial of their just demands during a long democratic struggle since independence. As it happen all over the word, it led to militant struggle with great loss of lives of military, police and civilian personnel. Killing of Indira Gandhi and massacre of innocent Sikhs in Delhi and other India cities was also associated with this movement.
Introduction to AI for Nonprofits with Tapp NetworkTechSoup
Dive into the world of AI! Experts Jon Hill and Tareq Monaur will guide you through AI's role in enhancing nonprofit websites and basic marketing strategies, making it easy to understand and apply.
Synthetic Fiber Construction in lab .pptxPavel ( NSTU)
Synthetic fiber production is a fascinating and complex field that blends chemistry, engineering, and environmental science. By understanding these aspects, students can gain a comprehensive view of synthetic fiber production, its impact on society and the environment, and the potential for future innovations. Synthetic fibers play a crucial role in modern society, impacting various aspects of daily life, industry, and the environment. ynthetic fibers are integral to modern life, offering a range of benefits from cost-effectiveness and versatility to innovative applications and performance characteristics. While they pose environmental challenges, ongoing research and development aim to create more sustainable and eco-friendly alternatives. Understanding the importance of synthetic fibers helps in appreciating their role in the economy, industry, and daily life, while also emphasizing the need for sustainable practices and innovation.
Model Attribute Check Company Auto PropertyCeline George
In Odoo, the multi-company feature allows you to manage multiple companies within a single Odoo database instance. Each company can have its own configurations while still sharing common resources such as products, customers, and suppliers.
2024.06.01 Introducing a competency framework for languag learning materials ...Sandy Millin
http://sandymillin.wordpress.com/iateflwebinar2024
Published classroom materials form the basis of syllabuses, drive teacher professional development, and have a potentially huge influence on learners, teachers and education systems. All teachers also create their own materials, whether a few sentences on a blackboard, a highly-structured fully-realised online course, or anything in between. Despite this, the knowledge and skills needed to create effective language learning materials are rarely part of teacher training, and are mostly learnt by trial and error.
Knowledge and skills frameworks, generally called competency frameworks, for ELT teachers, trainers and managers have existed for a few years now. However, until I created one for my MA dissertation, there wasn’t one drawing together what we need to know and do to be able to effectively produce language learning materials.
This webinar will introduce you to my framework, highlighting the key competencies I identified from my research. It will also show how anybody involved in language teaching (any language, not just English!), teacher training, managing schools or developing language learning materials can benefit from using the framework.
How to Make a Field invisible in Odoo 17Celine George
It is possible to hide or invisible some fields in odoo. Commonly using “invisible” attribute in the field definition to invisible the fields. This slide will show how to make a field invisible in odoo 17.
Read| The latest issue of The Challenger is here! We are thrilled to announce that our school paper has qualified for the NATIONAL SCHOOLS PRESS CONFERENCE (NSPC) 2024. Thank you for your unwavering support and trust. Dive into the stories that made us stand out!
1. Strategic Analysis Of Starbucks Corporation
Strategic Analysis Of Starbucks Corporation
By: Nithin Geereddy (ID: 80842082)
2. Strategic Analysis Of Starbucks Corporation
1) Introduction:
Starbucks Corporation, an American company founded in 1971 in Seattle, WA, is a premier roaster, marketer and
retailer of specialty coffee around world. Starbucks has about 182,000 employees across 19,767 company
operated & licensed stores in 62 countries. Their product mix includes roasted and handcrafted high-
quality/premium priced coffees, tea, a variety of fresh food items and other beverages. They also sell a variety of
coffee and tea products and license their trademarks through other channels such as licensed stores, grocery and
national foodservice accounts.1
Starbucks also markets its products mix with other brand names within its
portfolio of companies, which include Teavana, Tazo, Seattle’s Best Coffee, Starbucks VIA, Starbucks
Refreshers, Evolution Fresh, La Boulange and Verismo. Starbucks had total revenue of $14.89 billion as of
September 29th
, 2013.2
2) External Environment Of The Retail Market For Coffee & Snacks:
2.1) Industry Overview and Analysis:
Starbucks primarily operates and competes in the retail coffee and snacks store industry. This industry
experienced a major slowdown in 2009 due to the economic crisis and changing consumer tastes, with the
industry revenue in the US declining 6.6% to $25.9 billion. Before this, the industry had a decade of growth
consistent. Due to the economic slump, consumers spent less on luxuries like eating out, choosing to purchase
low-price items instead of high-priced coffee drinks due to shrinking budgets.
3
The industry grew at a low
annualized average growth rate of 0.9% from 2008 till 2013 with current industry revenues at $29 billion in the
US. The industry is now forecasted to grow at an annualized rate of 3.9% over the next five years, with a potential
to reach $35.1 billion revenues in the US. This growth would be mainly driven by an improving economy,
increase in consumer confidence and expanding menu offerings within the industry. Starbucks dominates the
industry with a market share of 36.7%, Dunkin Brands with 24.6% and other competitors like McDonalds, Costa
Coffee, Tim Horton’s etc. taking the rest as shown in Appendix 1.4
2.2) Industry Life Cycle and Market Share Concentration:
This industry is in a mature stage with a medium level concentration. Starbucks and Dunkin Brands make up
more than 60% of the market share (Appendix 1), giving them considerable market power in determining industry
trends. Industry Structure is given in Appendix 3.
2.3) Industry Demand Determinants and Profitability Drivers:
The industry’s demand for premium coffee and snack products are mainly driven by a number of factors which
include disposable income, per capita coffee consumption, attitudes towards health, world pricing of coffee and
demographics. This industry is highly sensitive to the macroeconomic factors that affect the growth in household
disposable. During the recession, the decline in household disposable income due to increased unemployment and
stagnant wages, caused a downward pressure on the revenue and profitability margins in the industry. Another
crucial factor for analyzing the demand in the industry is the per capita coffee consumption where the increase in
coffee consumption increases the revenue of coffee & snack shops. The main driver of this consumption increase
would be the increase disposable income, as the economy improves and consumers start to relax their budgets.
This driver has a positive effect on market revenue. Per capita coffee consumption is expected to increase in 2014.
As coffee beans are the primary input in the value chain of the industry participants, the prevailing volatile prices
of coffee beans determines market costs and profitability margins. The world price of coffee has risen sharply in
recent years due to growing demand in other countries and the resulting supply shortages. During the five years to
2018, coffee bean prices are projected to decrease, which will likely translate into lower market costs and higher
profitability.5
Attitudes towards health also play an important role in determining the demand in the industry.
3. Strategic Analysis Of Starbucks Corporation
There is an expected shift towards healthy eating and diet among the consumers in 2014, and this could be a
potential threat to the industry as they become more aware of issues related to weight and obesity. There has been
a proactive shift among the industry participants to tailor their menus towards more organic and healthy products
mix.
2.4) Porters Five Forces Analysis of the Retail Coffee and Snacks Industry:
Threat of New Entrants: Moderate
There is a moderate threat of new entrants into the industry as the barriers to entry are not high enough to
discourage new competitors to enter the market. (Appendix 2 shows Barriers to Entry Checklist).
The industry’s saturation is moderately high with a monopolistic competition structure.
For new entrants, the initial investment is not significant as they can lease stores, equipment etc. at a moderate
level of investment.
At a localized level, small coffee shops can compete with the likes of Starbucks and Dunkin Brands because
there are no switching costs for the consumers. Even thought it’s a competitive industry, the possibility of new
entrants to be successful in the industry is moderate.
But this relatively easy entry into the market is usually countered by large incumbent brands identities like
Starbucks who have achieved economies of scale by lowering cost, improved efficiency with a huge market
share. There is a moderately high barrier for the new entrants as they differentiate themselves from Starbuck’s
product quality, its prime real estate locations, and its store ecosystem ‘experience’.6
The incumbent firms like Starbucks have a larger scale and scope, yielding them a learning curve advantage
and favorable access to raw material with the relationship they build with their suppliers.
The expected retaliation from well-established companies for brand equity, resources, prime real estate
locations and price competition are moderately high, which creates a moderate barrier to entry.
Threat of Substitutes: High
There are many reasonable substitute beverages to coffee, which are mainly tea, fruit juices, water,
soda’s, energy drinks etc. Bars and Pubs with non/alcoholic beverages could also substitute for the
social experience of Starbucks
Consumers could also make their own home produced coffee with household premium coffee makers
at a fraction of the cost for buying from premium coffee retailers like Starbucks.
There are no switching costs for the consumers for switching to substitutes, which makes the threat
high.
But its important to note that industry leaders like Starbucks are currently trying to counter this threat
by selling coffee makers, premium coffee packs in grocery stores but this threat still puts pressure their
the margins.
Bargaining Power of Buyers: Moderate to Low Pressure
There are many different buyers in this industry and no single buyer can demand price concession.
It offers vertically differentiated products with a diverse consumer base, which make relatively low
volume purchases, which erodes the buyer’s power.
Even though there are no switching costs with high availability of substitute products, industry
leaders like Starbucks prices its product mix in relation to rivals stores with prevailing market price
elasticity and competitive premium pricing.
Consumers have a moderate sensitivity in premium coffee retailing as they pay a premium for higher
quality products but are watchful of excessive premium in relation product quality.
Bargaining Power of Suppliers: Low to Moderate Pressure
The main inputs into the value chain of Starbucks is coffee beans and premium Arabica coffee grown
in select regions which are standard inputs, which makes the cost of switching between substitute
suppliers, moderately low.
4. Strategic Analysis Of Starbucks Corporation
Starbucks, with its size and scale, has the power to take advantage of its suppliers but it maintains a Fair trade
certified coffee under its coffee and farmer equity (C.A.F.E) program, which gives its suppliers a fair
partnership status, which yields them some moderately, low power.
7
The suppliers in the industry also pose a low threat of competing against Starbucks by forward vertical
integration, which lowers their power.
Starbucks also forms a highly important part of the suppliers business, due its size and scope, which make the
power of the suppliers lower. Given these factors, suppliers pose a moderately low bargaining power.
Intensity of Competitive Rivalry: High to Moderate
The industry has a monopolistic competition, with Starbucks having the largest markets share and its closest
competitors also having a significant market share, creating significant pressure on Starbucks.
Consumers do have any cost of switching to other competitors, which crates high intensity in rivalry.
But its important to note that Starbucks maintain some competitive advantage as it differentiates its products
with premium products and services, which cause a moderate level of intensity in competition.
The industry is mature and growth rate has been moderately low which cause the intensity of competition
among the companies to be moderately high due to all of them seeking to increase market shaper from
established firms like Starbucks.
This industry does not have over capacity currently and all these factors contribute to the intensity among
rivals to be moderately high.
Looking at the Porters five forces analysis, we can get an aggregate industry analysis that the strength of forces
and the profitability in the retail coffee and snacks industry are Moderate.
3) Internal Analysis of Starbucks Corporation:
3.1) Starbucks Core Competence:
The core competence of Starbucks has been its ability to effectively leverage their cornerstone product
differentiation strategies by offering a premium product mix of high quality beverages and snacks. Starbuck’s
brand equity is built on selling the finest quality coffee and related products, and by providing each customer a
unique “Starbucks Experience”, which is derived from supreme customer service, clean and well-maintained
stores that reflect the culture of the communities in which they operate, thereby building a high degree of
customer loyalty with a cult following. Its other core competence is its human resource management's values-
based approach for building very strong internal and external relationships with suppliers, which drives the
successful deployment of its business strategy of organic expansion into international markets, horizontal
integration through smart acquisitions and alliances that maintains their long-term strategic objective being the
most recognized and respected brands in the world.
3.2) Starbucks SWOT Analysis:
Strengths:
Strong Market Position and Global Brand Recognition: Starbucks has a significant geographical presence
across the globe and maintain a 36.7% market share in the United States (Appendix 1) and has operations in
over 60 countries. Starbucks is also the most recognized brand in the coffeehouse segment and is ranked 91st
in
the best global brands of 2013.8
Starbucks effectively leverages its rich brand equity by merchandizing
products, licensing its brand logo out. Such strong market position and brand recognition allows the company
to gain significant competitive advantage in further expanding into international markets and also help register
higher growth in both domestic and international markets. Over the years, they have achieved significant
economies of scale with superior distribution channels and supplier relationships.
Products of the Highest Quality: They give the highest importance to the quality of their products and avoid
standardization of their quality even for higher production output.9
5. Strategic Analysis Of Starbucks Corporation
Location and Aesthetic appeal of its Stores: Starbucks has stores in some of the most prime and strategic
location across the globe. They target premium, high-traffic, high-visibility locations near a variety of settings,
including downtown and suburban retail centers, office buildings, university campuses, and in select rural and
off-highway locations across the world.10
This has earned them a significant competence and advantage to be
able to penetrate prime markets and tap into customers convince factor. Their stores are visually appealing and
have a ‘cool’ factor attached to it with being designed to reflect the unique character of the neighborhood they
serve in and environmentally friendly. They provide free wifi, great music, great service, warm atmosphere
and provide an environment of community meeting spot, which forms a wider part of the ‘Starbucks
Experience’. The main aim for the firm is to make their stores a ‘third place’ besides home and work.11
Human Resource Management: Starbucks is know for its highly knowledge base employees. They are the
main assets of the company and they are provided with great benefits like stock option, retirement accounts
and a healthy culture. This effective human capital management translates into great customer services. It was
rated 91st
in the 100 best places to work for by Fortune Magazine.12
Goodwill among consumers due to Social Responsibly Initiatives: Their stores are community friendly,
focused on recycling and reducing waste. They build goodwill among communities where they operate.13
Diverse Product Mix: Starbuck portfolio of products given in Appendix 8, that caters to all age groups
demographic factors.14
Use of Technology and Mobile Outlets: Starbucks efficiently leverages technology with its mobile application
“Starbucks App’ in both apple and android software’s. They make significant investments in technology to
support their growth every year.
15
Customer base loyalty: Starbucks has cult following status among consumers and they have also implemented
loyalty-based programs to drive loyalty with the Starbucks Rewards programs and Starbucks Card. The
Starbucks Card is a value card program that provides convenience, support gifting, and increase the frequency
of store visits by cardholders and integrated with their mobile application.
16
Weaknesses:
Expensive Products: While Starbucks does differentiate their products with being highly quality couple with
the whole ‘Starbucks Experience’, in times of economic sluggishness, consumers to have so switching costs to
competitor’s products with lower prices and forgo paying a premium. These premium prices could also pose
some weakness for it to succeed in developing countries.
Self-Cannibalization through overcrowding: By aggressive expansion and high saturation due to overcrowding
in the market leads to self cannibalization and diminishes long term growth targets of Starbucks. This is
happening especially in the United States where Starbucks operates 8078 stores.17
Overdependence in the United States market: In line with self-cannibalization of the US market with 8078
stores, Starbucks generates a huge percentage of their total revenue from the US and this makes it very
sensitive to prospects of the US economy and growth.
Negative large corporation image: Like any large corporation, Starbucks does come under increased scrutiny
and have to invest in corporate social responsibility activates and maintain tight control over labor practices.
American/European coffee culture clash with that of other countries: Starbucks coffee culture may not widely
accepted in some countries as part of their international expansion strategy.
Opportunities:
Expansion into Emerging Markets: The increase saturation and self-cannibalization of the US market makes its
international strategy even more important. Starbucks has made good inroad into many countries, with India
recently joining the list with a joint venture entry.18
Starbucks has a great growth potential in further expanding
into the emerging and developing markets. They can leverage their size, experience, financial prowess and
efficiencies to make new market share.
19
Expanding Product mix and offerings: Starbucks recently started to expand their product mix by venturing into
the Tea and fresh juice product offerings with a smart acquisition strategy.20
This provides significant
opportunities for Starbucks.
6. Strategic Analysis Of Starbucks Corporation
Expansion of retail operations: Starbucks currently sell its packed coffee products, iced beverages and
merchandizes through large box retailers. This market’s potential is yet to be fully realized and this provides
Starbucks great opportunities for the future to future monetizes their brand.
Technological advances: Starbucks has leveraged the use of mobile applications and has an investment
partnership with Square, a mobile payments app that is integrated with its Starbucks app. This creates an ease
of use process for customers, aligns customer loyalty through reward programs. Starbucks has already set the
bar in the industry with this advancement and about 10% of its transactions in the US have been made using
mobile applications.21
This is a growing field and would drive more business to their stores as technology
advances.
New distribution channels: Starbucks introduced a beta version of a delivery system called Mobile Pour. This
presents a great opportunity for the future by expanding their end product distribution systems and could drive
more revenue if the implementation is successful.22
Brand extension: Starbucks carries a powerful brand image and it can leverage it to extend into horizontal lines
of its business and also venture into product diversification with keeping brand dilution risk in check.
Threats:
Increased Competition: This is by far the biggest threat that Starbucks faces with the market being at a mature
stage, there is increased pressure on Starbucks from its competitors like Dunkin Brands, McDonalds, Costa
Coffee, Pete’s Coffee, mom and pop specialty coffee stores. Dunkin Brands had at its main threat in the US
market by trailing Starbucks with a 24.6% share. (Appendix 1)
Price Volatility in the Global Coffee Market: There has be significant fluctuations in the market prices of high
quality coffee beans, which Starbucks can’t control.
Developed Countries Market Saturation: Starbucks derives a significant amount of its revenue from the
development markets and there is increased market saturation currently.
Developed Countries Economy: In an increasingly economically integrated world, an economic crisis like the
one in 2008 could have a trickle down effect from the developed markets to the developing markets. This
threat would hurt revenues for Starbucks as consumers shift away from premium product mix to stay in limited
budgets during economic hardships.
Changing Consumer tastes and lifestyle choices: The shift of consumers toward more healthy products and the
risk of coffee culture being just a fad represent a threat for Starbucks going into the future.
3.3) Starbucks Generic Value Chain: Analysis in Appendix 6
3.4) Starbucks VRIO Analysis: Shown in Appendix 4. The VRIO framework is used to analyze in detail the
competitive position of Starbucks Corporation and its strategic positioning.
3.3) Starbucks Key Strategies:
One of the key strategy that Starbucks followed since its inception is that of product differentiation offering
differentiators such as premium product mix, locations, coffee beverages reputation and supreme customer service
that translated to building a premium valued brand which is costly to imitate for competitors. Starbucks has also
followed a shrewd strategy of strategic alliance and making smart acquisitions. Starbucks didn’t follow
franchising model and operated company oriented stores and joint ventures in international markets. Starbucks
has made some key acquisitions such as Teavana (Tea products), Bay Breads (premium bread products),
Evolution Fresh (fresh juice products) etc. to use the product diversification strategy. Appendix 7 gives a whole
list of joint ventures, strategic alliances and acquisitions of Starbucks. Starbucks acquisition strategy, as shown in
their acquisition history in Appendix, has been horizontal, product and market extensions acquisitions. Another
crucial strategy for Starbuck’s growth has been its international strategies of expanding into key developed and
emerging markets to geographically diversify, and it has been highly successful with operation spanning 60
countries. All these strategies have derive considerable competitive advantage for Starbucks over its competitors.
7. Strategic Analysis Of Starbucks Corporation
3.6) Starbucks Financial Performance Analysis:
Looking at a six year period ratio & growth analysis of Starbucks’s financials from 2008 to 2013, we can see that
the revenue growth of the company has experience a drop of -5.9% during the 2008/09 recession but from then
on, Starbucks posted a healthy revenue growth of from FY2010 to FY2013 with posting a great growth of 13.7%
in FY2012 and currently posted revenues $14.9 billion for FY2013. The operating income margins have increase
substantially from 4.9% in FY2008 to a high of 15% in FY2012. Starbucks posted an operating loss in FY2013
and this resulted in a operating margin of -2.2% for that year and the main reason for that is due to a litigation
charge of $2.8 billion to Kraft Foods for terminating an agreement with them. This charges is treated as
extraordinary event and therefore should be discounted from the overall healthy operational performance of
Starbucks. Starbucks ROE and ROA have been impressive with 29.2% and 17.8% respectively for FY2012.
Looking at Starbucks efficiency ratios, Starbucks has gained significant operational efficiency with impressive
asset and inventory turnover ratios with a low of 1.51 and 5.4 respectively for FY2013. But its interesting to note
that the company’s cash conversion cycle has increase to high 54.7 in FY2013, which is where Starbucks should
concentrate on to reduce to attain higher efficiency. Starbucks boasts good financial health with low debt/leverage
with a debt/equity ratio of 0.29 for FY2013 and maintains decent current and quick ratios. A detailed financial
ratio and growth calculations are given in Appendix 5.
4) Recommendations:
Starbucks biggest growth is in its International segment. The emerging markets of Brazil, India,
China, South Africa and Mexico with a growing middle-class population continue to offer significant
opportunities to add new stores and serve more customers. Starbucks has already made significant
inroads into the Chinese market but there still is a lot of untapped potential growth in these markets.
Starbucks should grow in these emerging markets by winning locally Starbucks must remain relevant
to the customer in order to grow in these markets, and its management teams should have the freedom
to operate within their overall framework to tailor store format, introduce local product mix and price
points to the needs, lifestyles and tastes of each individual market/community.
Under Starbucks international strategy, it should transfer its core competencies and capabilities
country to country and then gradually build profit drivers in several countries as it continues its global
expansion in an organic way.
Starbucks has great growth opportunities in Tea and Fresh Juice products mix. They should build up these
products along the same line of their core coffee products.
Also as consumer tastes and lifestyle shift towards more snacks and beverages options, Starbucks should
tailor its menu’s and expand to give more healthy product offerings in its mix.
Coffee beans are a significant input into Starbucks value chain and there have been wide fluctuations in the
market prices of high quality coffee beans. Starbucks could mitigate this price volatility risky by
implementing an effective hedging strategy like future contracts to lock in their estimated quantity inputs at a
low swing price so that the future costs can be managed to a greater extent.
Starbucks growth strategy in the saturated U.S. market should focus on getting additional penetration into
untapped rural markets.
Another growth sector is its packaged coffee packets and iced beverage products. Starbucks should build
better relationships with big box retailers to get premium shelf space and increase the efficiency of this
distribution channel.
From their 10-K’s, we can see that Starbucks invest very little in advertising and marketing initiatives. It
would be recommended that Starbucks make significant investments in advertising and marketing initiatives
in the face of increased competition in the market.
Further build and retain customer loyalty, by building on beta concept of on-the-go home delivery.
Their mobile apps business drove 10% of the sales in the US, so it would be recommended for further
building to stream lining ease of use and payment process which would help drive more customers, decrease
wait time in stores and increase efficiency. Integrating Starbucks loyalty program with the mobile application
would also be recommended.
8. Strategic Analysis Of Starbucks Corporation
References:
1
Starbucks 2013 10-K Form for FY ended on September 29th
, 2013
2
Starbucks 2013 10-K Form for FY ended on September 29th
, 2013
3
IBIS World: The Coffee & Snack Shop Industry in the US Report, October 2013
4
IBIS World: The Coffee & Snack Shop Industry in the US Report, October 2013
5
IBIS World: The Coffee & Snack Shop Industry in the US Report, October 2013
6
http://www.starbucks.com/about-us/company-information/mission-statement
7
http://www.starbucks.com/responsibility/sourcing/coffee
8
http://interbrand.com/en/best-global-brands/2013/Starbucks
9
Starbucks 2013 10-K Form for FY ended on September 29th
, 2013
10
Starbucks 2013 10-K Form for FY ended on September 29th
, 2013
11
http://www.starbucks.com/coffeehouse/store-design
12
http://money.cnn.com/magazines/fortune/best-companies/2013/snapshots/94.html
13
http://www.starbucks.com/responsibility/community
14
GlobalData: Starbucks Corporation Research Report, March 2013
15
http://blogs.wsj.com/corporate-intelligence/2013/07/26/starbucks-talks-about-its-future-more-
food-more-digital/
16
Starbucks 2013 10-K Form for FY ended on September 29th
, 2013
17
Starbucks 2013 10-K Form for FY ended on September 29th
, 2013
18
http://online.wsj.com/article/PR-CO-20131122-905464.html
19
http://www.forbes.com/sites/walterloeb/2013/01/31/starbucks-global-coffee-giant-has-new-
growth-plans/
20
http://seekingalpha.com/article/637841-starbucks-smart-acquisition-strategy
21
http://techcrunch.com/2013/07/26/mobile-payment-at-u-s-starbucks-locations-crosses-10-as-
more-stores-get-wireless-charging/
22
http://www.starbucks.com/blog/introducing-starbucks-mobile-pour
23
Starbucks 2013 10-K Form for FY ended on September 29th
, 2013
Supplementary Sources:
http://www.mckinsey.com/insights/growth/starbucks_quest_for_healthy_growth_an_interview_
with_howard_schultz
http://www.forbes.com/sites/walterloeb/2013/01/31/starbucks-global-coffee-giant-has-new-
growth-plans/
http://seattletimes.com/html/businesstechnology/2020031178_starbucksteavanaxml.html
9. Strategic Analysis Of Starbucks Corporation
Appendix 1: US Coffee and Snacks retail market share
Source: IBIS World Report
Appendix 2: Barriers to Entry Checklist
Source: IBIS World Report
Appendix 3: Industry Structure
Source: IBIS World Report
Appendix 4 continued next page…
10. Strategic Analysis Of Starbucks Corporation
Appendix 4: Detailed VRIO Analysis of Starbucks Corporation
Resources and Capabilities of Starbucks Corporation Value? Rare? Costly to
Imitate?
Exploited? Competitive
Implication
Prime and Strategic Locations:
In high-traffic, high-visibility locations near a variety of
settings, including downtown and suburban retail centers,
office buildings, university campuses, and in select rural and
off-highway locations across the world.
Tap into customers convince factor
Yes Yes No Yes
Temporary
Competitive
Advantage
Global Brand Recognition & Equity
The most recognized brand in the coffeehouse segment and is
ranked 91st
in the best global brands of 2013
Effectively leverages its rich brand equity by merchandizing
products, licensing its brand.
Yes Yes Yes Yes
Competitive
Advantage
Aesthetic Appeal and Concepts of its Stores
Their stores are visually appealing and have a ‘cool’ factor
attached to them.
Provide free wifi, great music, great service, warm atmosphere
and provide an environment of community meeting spot, which
forms a wider part of the ‘Starbucks Experience’.
Concept of the stores as being a ‘third place’ besides home and
work.
Designed to reflect the unique character of the neighborhood
they serve in and environmentally friendly.
Yes Yes Yes Yes
Competitive
Advantage
Large Size and Strong Global Presence
Operation in 60 countries and largest coffee/snack retailer
Economies of scale through superior distribution channels and
supplier relationships
Lower input costs
Yes Yes Yes Yes Temporary
Competitive
Advantage
Human Resource Management and Company Culture
Employees provided great benefits like stock option, retirement
accounts and well taken care of
Knowledge based employees creating a healthy corporate
culture
Ranked 91st in the 100 best places to work for by Fortune
Magazine
Great human capital management couple with great corporate
culture translates into supreme customer service
Yes Yes Yes Yes
Competitive
Advantage
Leveraging Technology and Mobile Outlets
Starbucks Apps on iOS and Android
Investment in Technology
Yes Yes No Yes Temporary
Competitive
Advantage
Customer Loyalty and Cult Status
They have a cult following status among consumers
Loyalty-based programs like Starbucks Rewards and Starbucks
Card drive loyalty.
Starbucks Card is a value card program that provides
convenience, support gifting, and increases the frequency of
store visits by cardholders
Yes Yes Yes Yes Competitive
Advantage
Good Corporate Social Responsibility Image
Their stores are community friendly, focused on recycling and
reducing waste.
They build goodwill among communities they operate in
Strong Social Responsibility Initiatives undertaken
Yes Yes No Yes Temporary
Competitive
Advantage
11. Strategic Analysis Of Starbucks Corporation
Appendix 5: Starbucks Corporation’s Financials
Starbucks Corporation's Financials for Fiscal Year ending September of each year (All USD figures in millions)
Key Ratio's/Accounts FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013
Profitability Ratio's
Revenue 10,383 9,775 10,707 11,700 13,300 14,892
Gross Margin % 19.2 55.8 58.4 57.7 56.3 57.1
Operating Income (USD Millions) 504 562 1,419 1,729 1,997 -325
Operating Income Margin % 4.9 5.7 13.3 14.8 15 -2.2
Net Income (USD Millions) 316 391 946 1,246 1,384 8
Net Margin % 3 4 8.8 10.7 10.4 0.06
Return on Equity (ROE) % 13.2 14.1 28.14 30.9 29.2 0.17
Return on Assets (ROA) % 5.73 7 16 18.1 17.8 0.08
Earnings Per Share (EPS) 0.43 0.52 1.24 1.62 1.79 0.01
Efficiency Ratio's
Asset Turnover 1.89 1.74 1.79 1.7 1.71 1.51
Inventory Turnover 12.1 6.4 7.4 6.6 5.3 5.4
Fixed Asset Turnover 3.5 3.5 4.3 4.9 5.3 5
Days Sales Outstanding 10.9 11.2 9.8 10.75 12 12.8
Days Inventory 30.11 57.3 49.4 55.6 69.3 67.3
Payable Period 15.6 25 22.5 30.3 29.4 25.4
Cash Conversion Cycle 25.4 43.5 36.7 36.1 52 54.7
Liquidity & Financial Health Ratio's
Current Ratio 0.8 1.3 1.55 1.83 1.9 1.02
Quick Ratio 0.3 0.6 1 1.17 1.14 0.71
Debt/Equity 0.22 0.18 0.15 0.13 0.11 0.29
Financial Leverage 2.28 1.83 1.74 1.68 1.61 2.57
Year on Year Growth %
Revenue Growth % 10.3 -5.9 9.5 9.3 13.7 12
Source: All Financials used here are derived from Starbucks10-K Form for Fiscal Years ended
2008, 2009, 2010, 2011, 2012, and 2013
12. Strategic Analysis Of Starbucks Corporation
Appendix 6: Starbucks Generic Value Chain:
Primary activities
Inbound logistics – Sourcing coffee from diverse coffee beans producers with whom they have great
relationships and built up efficient supply chain management system.
Operations – They have operation in 60 countries with their stores being modeled on company operated
stores and licensed stores.
Outbound logistics – Most of its product mix are sold in-store and some through large box retailers.
Payment around source through point of sale, prepaid Starbucks Cards and mobile payments.
Marketing and Sales – Traditionally, investment in marketing activities have not be significant and relied
mainly on the growing reputation of premium quality product mix and superior customer services to give
the ‘Starbucks Experience’ to drive customers to their stores and products.
Service - Starbucks has a reputation for providing supreme level of customer services to their consumers.
Support activities
Firm Infrastructure. They have well designed, aesthetically pleasing stores. They have efficient level of
finance, accounting and legal departments to support the firm’s infrastructure.
Human Resource Management – Great benefits, employee empowerment and amazing corporate culture
makes Starbucks drive efficient management of human capital.
Technology development – Investments in innovative technologies like the well like mobile app.
Procurement – Starbucks procures its products from a diverse group of supplier and has fixed contracts
with some of the suppliers.23
13. Strategic Analysis Of Starbucks Corporation
Appendix 7: History of Strategic Acquisition, Joint Venture, Strategic Alliances
and Product Extensions
Continued next page…
14. Strategic Analysis Of Starbucks Corporation
Source: Global Data and MarketLine Financial Deals, Starbucks Corporation, 2013 Reports.
Continued next page…
Source: Global Data and MarketLine Financial Deals, Starbucks Corporation, 2013 Reports.
15. Strategic Analysis Of Starbucks Corporation
Source: Global Data and MarketLine Financial Deals, Starbucks Corporation, 2013 Reports.
16. Strategic Analysis Of Starbucks Corporation
Appendix 8: List of Starbucks Product Mix:
Source: GlobalData and Starbucks Website
17. Strategic Analysis Of Starbucks Corporation
Source: GlobalData and Starbucks Website