Analysis of Starbucks: Threats and Competitive Edge

Management
Corporate skills
Student’s Name

Corporate skills 1
Introduction
Starbucks is one of the American coffee companies, which are famous due to its high
quality whole coffee beans, and Starbucks count on genuine services. In today’s time,
Starbucks has successfully grown through an adoption of management effectiveness and
through its strategic approaches; they have led to become number one coffee all over world
(Michelli, 2006).
In terms of porters five force model- there are 5 major aspects which comprises of
threat of new entrant, threat of substitute, threat of competition, bargaining power of the
supplier and lastly bargaining power of the buyers are considered (David, & David, 2013).
Threat of new entrant Effect of threat of new entrant is
moderate in nature of Starbucks.
Threat of new entrant-
In terms of Starbucks, the number of entry in this industry is moderate in nature, as
Starbucks has established a huge chain of stores with its higher investment. As there is low,
possibility of new firm to enter as Starbucks has captured or grabbed a large market share on
the basis of its infrastructure, efficiency and product quality. However, are other company
starts its newer firm with low prices there can be chances to attract more of customers.
Hence, Starbucks competitive edge, which none other can be known, is the access to raw
material and suppliers and having a better quality coffee and larger number of suppliers
globally (Tu, Wang, & Chang, 2012).
Threat of new Substitute Effect of threat of new substitute is
moderate to high in nature of
Starbucks.
Threat of substitutes-