German University in Cairo
Strategic Analysis for Starbucks
Class: Strategic Analysis 704
Monday from 8 PM to 10 PM
Represented to: Dr. Saneya El Gallaly
Table of Content
* In 1971 Starbucks opened operations in Seattle’s Pike Place
Markets with the future aim of providing coffee to a number of
restaurants and surrounding bars. With the recruitment of Howard
Schultz who led the marketing and retail efforts of Starbucks.
* In 1982, the company took a change in direction through the views
of Schultz, who after visiting Italy tried to adapt the same principles in
order to a ...view middle of the document...
pushed through the development of coffee houses in Japan.
*By the year 2000, things had progressed so far that 3,300 stores
were already opened, the company had ventured into countries
ranging from England to Australia & China.
* By last quarter of 2008, total international stores became 5113
store & 11567store in United States.
2- Current situation
The current international situation for Starbucks seems to be an
emerging part of their business and the reorganization of this is proved
by their aim to become a leading global company through making a
difference in people’s lives all around the world. This goal is quite close
to being achieved as proved the Starbucks current locations in
international markets and the successfulness of these ventures. The
current countries in which Starbucks are located in are: Australia,
Malaysia, New Zealand, Oman, Peoples Republic of China, Philippines,
Qatar, Saudi Arabia, Singapore, South Korea, Switzerland, Taiwan,
Thailand, United Arab Emirates, Egypt, United Kingdom, and the
2.1 Current performance
Overall, the aim of becoming a worldwide global brand seems to be
working in favor of the company and is helping it to attract the
attention of many major companies who would like to share a
partnership. This is all positive news for the company because it
provides a strong basis for future development of international
markets, which further strengthens the mission to become one of the
leading specialty coffee retailers in the world.
However, the net revenues increased 3 percent to $2.5 billion for the
fourth quarter of 2008, compared to $2.4 billion for the fourth quarter
of 2007. For the 13-week period ended September 28, 2008,
Starbucks reported net income of $5.4 million, which included $105.1
million of restructuring charges and other transformation strategy
costs. Net income was $158.5 million for the same period a year ago.
The company actions announced in July of 2008 to close approximately
600 company-operated stores in the U.S. and 61 company-operated
stores in Australia, and reduce approximately 1,000 open and filled
positions within its leadership structure and non-store organization.
2.2 Strategic posture
“To inspire and nurture the human spirit— one person, one cup,
and one neighborhood at a time”
“The mission of Starbucks is to establish Starbucks as the
premier purveyor of the finest coffee in the world while
maintaining our uncompromising principles while we grow”
None of this success would have been possible without a set of
goals that the company aimed to achieve and a set of principles,
which governed the decision making process. The six principles
of Starbucks are stated as:
1- Provide a great work environment and treat each other with
respect and dignity.
2- Embrace diversity as an essential component in...