Entering Foreign Markets: Starbucks Growth Strategy

This document discusses Starbucks' growth strategy in entering foreign markets and highlights the key drivers of growth. It also explores the reasons for Starbucks' failure in the Australian market. Additionally, it delves into the impact of technology on international production, outsourcing, and logistics. Lastly, it examines the issue of child labor and the role of businesses in addressing this problem.

Reflective portfolio

Week 5: Entering Foreign Markets
Activity one
Starbucks corporation has a strong note on sales growth which is a great effort by the company
to consider and highlight the impact of sales on profit. The specialty coffee that the people like is
the development progress in Asian market (Team, 2016). One of the major driver of growth is
specialty coffee. With the digital initiative programs, the loyalty programs and the digital
payment strategy, Starbucks has achieved growth in the market.
The drivers of growth in the company are the increase in the number of stores, elevating the
coffee experience, crating customer occasions, driving at home coffee occasions, building
Teavana, extension of digital engagement and establishing partnerships. These are the key
drivers that enhance the growth of sales and directly ensures the profit of the company. Starbucks
has expanded the market and thereby it is important to have these strategies to be implement in
the company with utmost consideration of revenue of the company (Surroca, Tribo & Zahra
2013). Driving at home coffee share will entail consumer products that consist packaged coffee
and consider in K-Cups with significant growth in the coffee market. improved food offering
items and fresh food such as sandwiches and tea have encouraged the growth in the market while
creating new customer occasions. With the number of stores in the market, the growth strategy
by Starbucks will be most effective that expands the market and its importance in selling coffee.
Coffee giant concentrates on the outer edges and walk-thrus at several place in Seattle, Boston
and New York. There is an incremental growth that opens with cannibalization and considers the
confidence of sales growth in the US sector.
Activity two
Australia is the continent where Starbucks have not considered a good market. Despite deep love
for coffee, the country did not meet the success criteria as it should have been like in other
countries. There are several reasons that can be considered in the growth for Starbucks in
Australia (Turner, 2018).
In the year 2000, Starbucks has opened the stores and lately in 2008, there were 90 locations
where Starbucks was available. Due to over location of stores in Australia and the fastest going

pace, the popularity of Starbucks did not meet the expectations. The stores were launched too
rapidly which was the major reason of failure for Starbucks. People in the country could not
develop the appetite for coffee and Starbucks brand. A higher challenge in the American brand
was noticed effectively while there was challenge for American brand to enter in the Australian
market.
Another reason for failure of Starbucks revealed that the company did not meet the taste of
Australians as there were many coffee brands in the country. Starbucks served a sweeter version
of coffee which Australians did not prefer. The high charges of coffee were not preferred by
Australians while compared to the local cafes (Crane & Matten, 2010). There are still Starbucks
cafes in Australia within 39 locations in Gold Coast, Melbourne, Sydney and Brisbane. The
company is trying to cater the market with a different recipe for success.
Week 6: International Production, Outsourcing and logistics
Amazon Global logistics will offer services quickly and consider the feasibility options. It is
important to have a major concern on the technology concepts that are newly applied in the
business. Technology will definitely change the face to service delivery in the near future. The
buyer and seller will be now able to communicate easily with the technological impact and the
tools and techniques that enhance connection and communication between buyer and seller.
Technology will change the face of service delivery while providing door step services and
considering the importance of technology in the logistics. There is a drastic move that has been
noticed from personal service like door to door step service to a major automated form of
service. The face of service delivery is quick while compared to the old service methods and
support the customer journey. Customer satisfaction is higher while gaining importance to self
service and considering the impact of technology and its benefits. With the help of world wide
web, the boundaries are reflected and the technology importance is expanded in the service
delivery face which is an important part in automated service delivery. Although the work is
automated and considers a growth in service and transaction delivery, the impact of technology
would be incredible. The customer or the buyer just needs to add the product from the website
while the product will reach to the customer in just few days or hours. On the other hand, seller
would dispatch the goods and the transportation of the goods to the buyers will reach in no time.
This is where the technology is reaching with its grand ideas and creative concepts (Chen 2016).

Technology will change the logistics and delivery channels for the future. This is the most
important technique wherein the technology would accept the product delivery within no time.
When the buyer orders something, the confirmation of goods is in seconds that notify the
delivery time and the channels. During the process of confirmation, the seller confirms that the
goods will reach to the buyer in a day or two. Consequently, the logistics work at this moment.
The delivery channels that are connected include the transportation, dispatch and arrival of goods
at the buyer’s place. These are all mid between channels who consequently thrive to deliver the
product at buyer’s place or the destination.
Amazon is looking for people who can manage the channels such as software engineers, product
mangers and other professionals who deal with product delivery. Buyers can now easily
communicate from any part of the country while receiving the product that they wish. Diverse
range of backgrounds who can manage the team are required by Amazon Logistics. To design
global solutions and engage with the team is the major factor that enhances the logistics
technology.
Week 7: Ethics and Corporate Social Responsibility
Child labor is the heartbreaking news that is surrounded in the country. In the age of
communication and technology, there exists the farthest corner that the child labor is still
prevalent in the country. With the global statistics, the biggest roadblock that is measured is child
labor (Servaes & Tamayo, 2013). The human rights are ignored consequently while defining
International Labor Organization. child labor is harmful for mental and physical development of
a child which considers the potential and the dignity of children. It is important to develop the
abilities of children into childhood activities rather than child labor which is a crim. There are
figures and statistics that allow us to know that there are still places where child labor is
prevalent and there is no rather less action taken by the country to protect child rights
(TheWorldCounts 2014).
The latest statistics derive that there are more than 200 million children in the world who are still
child laborers and are estimated to reach towards an hazardous condition in relative years. There
are 73 million children that are below the age of 10 years old. These figures are statistically true
but is surprising to know that the number of children who have armed conflicts are 300,000 in a

decade. There are children who work for producing consumer products such as cotton, crops,
rubber, coffee and cocoa. More than 20 million child workers are in factories that make carpets,
garments, hand-rolled cigarettes and toys. This is considered from modern day slavery statistics.
The one who is influencing the child labor is the business itself. Business is not doing good to
find a solution, rather it is making situation worst. In the economy, it is important for a business
to take care that child labor should not be allowed in factories or stores. This is a horrified figure
that has made me to think about the world economics and the results. Being aware about the
consumer and its right is the major think that is affordable and can prevent child labor.
Companies who employ child labor need to immediately stop and think about the children who
have lost their childhood while focusing on work and leaving their childhood behind. There may
be initiatives that the business man can take while raising an awareness about the statistics of
child labor and controlling the whole scenario as soon as possible. The fair trade products are
generally produce without child labor which should be the major concern for a person to
consider the efforts of human rights and focus on child welfare.

References
Crane, A & Matten, D, 2010, Business Ethics: managing corporate citizenship and sustainability
in the age of globalization (3rd ed.) Oxford: Oxford University Press
Chen, J, 2016, Amazon Global Logistics Technology, Retrieved from
https://www.youtube.com/watch?v=1PHwq1-f62k
Servaes, H., & Tamayo, A. 2013, The impact of corporate social responsibility on firm value:
The role of customer awareness. Management Science, vol. 59, pp. 1045–1061.
Surroca, J., Tribo, J. A., & Zahra, S. A, 2013, Stakeholder ´ pressure on MNEs and the transfer
of socially irresponsible practices to subsidiaries. Academy of Management Journal, 56: 549–
572.
Team, T. 2016, Let's look at Starbuck's Growth Strategy. Retrieved from
https://www.forbes.com/sites/greatspeculations/2016/09/19/letslook-at-starbucks-growth-
strategy/#2ff530033d71
Turner, A., 2018, Why there are almost no Starbucks in Australia. Retrieved from:
https://www.cnbc.com/2018/07/20/starbucks-australia-coffee-failure.html
TheWorldCounts, 2014, From the Sweat of our children, Retrieved from
http://www.theworldcounts.com/stories/Child-Labor-Facts-and-Statistics