Starbucks is the largest coffeehouse company in the world with over 23,000 stores globally. It serves hot and cold coffee and tea beverages as well as snacks. Starbucks has pursued an aggressive global expansion strategy and ensures ethical sourcing and community involvement. It faces competition from substitute products but maintains power over suppliers. Recommendations include expanding into tea and juice, targeting rural markets, and improving their mobile app integration.

1. STARBUCKS

2. INTRODUCTION
• Starbucks Corporation, doing business as
Starbucks Coffee, is an American global coffee
company and coffeehouse chain based in Seattle,
Washington.
• Starbucks is the largest coffeehouse company in
the world, with 23,305 stores in 65 countries and
territories, including 13,049 in the United States,
1,909 in China, 1,555 in Canada, 1,089 in Japan
and 927 in the United Kingdom.

3. WHAT THEY DO ?
• Starbucks locations serve hot and cold beverages, whole-
bean coffee, micro ground instant coffee, full-leaf teas,
pastries, and snacks.
• Most stores also sell pre-packaged food items, hot and cold
sandwiches, and items such as mugs and tumblers.
Starbucks Evenings locations also offer a variety of beers,
wines, and appetizers after 4pm.
• Through the Starbucks Entertainment division and Hear
Music brand, the company also markets books, music, and
film. Many of the company's products are seasonal or
specific to the locality of the store. Starbucks-brand ice
cream and coffee are also offered at grocery stores.

4. GROWTH OF STARBUCKS

5. PORTERS 5 FORCE ANALYSIS

6. ANALYSIS
• Threat of New Entrants (Low)
– Coffee chain market is saturated in the US and UK
– Significant capital requirements are needed mainly
for renting and leasing buildings
• Threat of Substitute Products (High)
– Increasing ranges of energy drinks
– Increasing focus on negative affects of caffeine on
the media and among consumer

7. ANALYSIS
• Bargaining Power of Buyers (High)
– The numbers and variety of offers in the industry
exceeds the demand
– No or minimum switching costs to other companies
• Bargaining Power of Suppliers (Strong)
– Raw material (coffee beans) is available only from
limited geographical areas such as Africa, Latin
America, and some parts of Asia
– The level of competition amongst coffee chains is
fierce

8. BUSINESS LEVEL STRATEGY
• All stores are company-owned and operated ensuring
complete control over an unparalleled image of quality
• Follows “Hub” Strategy
• Flawless Execution : The company continues to focus
on its original product bundle that includes good coffee,
quality service, and a nice environment to hang around.
• Believes Employee Expectations should exceed
customer expectation

9. ETHICAL SOURCING
• Not only ensures high quality but also the coffee
beans are grown responsibly and ethically traded
• World’s largest buyer of fair-trade coffee and pays
more than market price
• Works continuously with farmers on responsible
methods such as planting trees to help preserve
forests

10. COMMUNITY SERVICES
• Literacy programs for children and families of
employees in US and Canada
• Volunteer community service hours
• Partner of Product RED
• Consistent donations for improvement of water

11. ENVIRONMENT
• Use of Recycled Cups
• Also emphasizes on Energy and Water
Conservation and building green, LEED-
certified buildings

12. RECOMMENDATIONS
• Engage : “Hear from Howard” employee webcasts with
live Q&A
• Referral Bonuses: Increases recruiting pool and gives
employees(trusted source) reason to spread image of ―
“Best Place to Work”.
• Recognize: Employee of the Month pictured for each
store location online.
• Happy Hours Introduction

13. RECOMMENDATIONS
• 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.
• Starbucks growth strategy in the saturated U.S. market should
focus on getting additional penetration into untapped rural
markets.
• 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.

14. THANK YOU