Report on Coffee Shops: Starbucks

Report on Coffee Shops
Starbucks

Table of Contents
INTRODUCTION ..........................................................................................................................4
Main Body.......................................................................................................................................4
Discuss international strategy.....................................................................................................4
Global supply chain strategy along with its strategic fit with international strategy..................6
Critically examine the elements of supply chain........................................................................7
Global distribution network design of Starbucks........................................................................9
Recommendation.......................................................................................................................11
CONCLUSION ............................................................................................................................11
REFERENCE.................................................................................................................................13

INTRODUCTION
Supply chain management refers a function to make product and service available to the
end user at right time. It is a wide concept which comprises several activities from the
conversion of raw material to the distribution of end product & service to customers (MORO,
2019). The present report is about Starbucks that is a multinational organization based on
America. It owns substantial chain of coffee-houses at international level. The report renders a
detailed overview regarding international strategy and its strategic fit with global supply chain of
company. It comprises different elements of supply chain management and their association with
each other. Lastly, some appropriate recommendations are also given in the report for further
enhancement .
Main Body
Discuss international strategy
Internationalization is really crucial for organizations to expand business in different
countries. As per the current trends, it is essential for a company to explore operations at
international level to ensure long term sustainability at market place. For this different strategies
are discussed as under:
International strategy: It is a strategy that is prepared by managers to expand business
across the globe in different countries. It requires detailed assessment of resources, market
dynamics, environment, competition prevailing within international market place. Nowadays, to
sustain in market for longer run, it is vital to expand business (Chang, 2020). In addition,
internationalization also helps to enhance the presence of brand in different countries that further
provides higher competitive advantage, With this, organization is able to serve domestic as well
as global audience that will provide substantial opportunities to earn potential profit margin. In
context of Starbucks, they are using international strategy through opening outlets in different
countries worldwide.
Standardization strategy: In this, organization assume whole world as single market
place thus provide similar products and services to the audience of different countries. Here, they
standardized their product in such a manner that it will be able to cater the needs & requirements
of domestic as well as international customers. This strategy is based on the assumption that one
identical product can fulfil needs of people across different locations. Under this, managers enter

into global market place but do not add any new variant in existing product and services as they
keep it standardized. In case of Starbucks, managers use standardization in order to develop
reliability and trust among customers so that they get the similar experience at each and every
outlets of organization in different countries.
Localization strategy: It is a crucial strategy that is used by several companies in order to
meet with needs and desires of international audience in significant manner (Luo and Zheng,
2018). Here, managers undertake extensive market research before entering into new market
place with an aim to get detailed information regarding culture, values, buying behaviour of
customers. In this, they emphasis to make appropriate changes in their product & services to
ensure sustainability in the environment of different countries. It is analysed that Starbucks takes
extensive market research regarding culture, preferences of local audience before start their
outlet. They design menu, interior, ambiance to address the desires of local customers but do not
compromise with core product. Localization strategy of organization includes a creative store
design along with mix of local products in order to grab the attention of local audience.
Transactional strategy: Here, organization simultaneously run business in different
countries at global level. Main aim of this strategy is to earn higher sales as well as profit margin
by exploring business operations in different countries at global level. Here, different franchise,
international branches are managed and control by headquarter of organization (Wang and
Ghauri, 2020). Policies are also determined by higher authorities that are applicable on different
branches at global level. It is essential to have uniformity and better co-ordination. In regards of
Starbucks, it uses transactional strategy by opening franchises in different nations world wide
with an aim to enhance the presence of brand.
With above stated points, it is analysed that transactional strategy is seems to the most
suitable strategy for Starbucks as it will help to explore business worldwide. In addition, market
research is the key function of entity that is essential to take appropriate decision of business
expansion. It is analysed that organization is moving from one to another strategy of
internationalization. At initial level, they were adopting localization by making modification in
core product as per the culture of different countries. Over the time, they emphasis to provide
similar experiences to all their customers regardless country so they focus on standardization
under which no variations will be done in core product. Therefore, Starbucks adopt different