Starbucks Essay

1180 words - 5 pages

Summary
Millions of people all over the world walk into Starbucks every day for their cup of coffee, but it is more than the overpriced coffee that brings people in day after day to the Starbucks stores across the world. Starbucks offers an upbeat environment and friendly and helpful staff to assist customers in any question or problem they might have with the coffee or service. People buy Starbucks for what it represents and the status symbol that comes along with it. Starbucks is currently one of the top contenders in the coffee industry. It is aware of the stiff competition and is prepared to combat it however possible. In order to better determine Starbucks’ situation in the specialty ...view middle of the document...

Wireless internet is a major strategic asset to Starbucks, and it will continue to help them in the future countries that they introduce it to. Another strategic asset to the company is the decision to enter India as a new international destination for business. India has a growing economy and upper and middle classes; because of this, Starbucks will be able to help open the eyes of its citizens to specialty coffee. Its citizens are starting to refrain from tradition and embrace new and trendy styles. Another major country for Starbucks to explore is China. Starbucks recently entered China, and it is focusing on the growth potential that China currently has with coffee sales growing 9% just last year .With continual growth in China, Starbucks will be able to take on McDonald’s as it begins to expand its coffee business. China is currently on its way to being the second-largest coffee market, leading Canada, the United Kingdom, and Japan. This means that Starbucks will see significant profits rise as its new star target market begins to rise. Starbucks has a strong transnational strategy that will allow it to continue to achieve success in the years to come.

SWOT Analysis
Another significant tool in analyzing Starbucks’s current position in the specialty coffee industry is a SWOT analysis. Starbucks has several strengths in the coffee industry. A couple strengths that Starbucks has is that it is the market leader in the coffee industry, and that it has 16,858 stores as of the end of the fiscal year in 2010.Another strength that Starbucks has is its rapid pace of growth, not only domestically but also internationally. Many of the stores that are opening are coming from the international market. Starbucks is also financially sound which was proven during the financial crisis in 2008 and 2009. Its stock price might have fallen, but its profits barely took a hit. Starbucks also has strong brand recognition by consumers. It is known for its high quality products and its consumer friendly environment. Starbucks’ has a lot of strengths that will carry it through the years to come although Starbucks has a lot of strengths, it also has weaknesses. One of Starbucks’ major weaknesses is its price. McDonald’s uses Starbucks’ high price directly against the company in their marketing campaigns. Another weakness of Starbucks is that 75% of its profits are based off its coffee products and other specialty beverages. This means that with the escalating coffee bean prices that Starbucks will...

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