SWOT and PESTLE Analysis for Starbucks

This report provides a comprehensive analysis of the SWOT and PESTLE factors affecting Starbucks, including the impact of COVID-19 on its business. It also discusses the importance of corporate social responsibility (CSR) and the suitable leadership style for Starbucks. The report concludes with a reflection on the research process.

Starbucks

Table of Contents
INTRODUCTION...........................................................................................................................1
Main Body.......................................................................................................................................1
1. SWOT and PESTLE analysis for Starbucks............................................................................1
2. Popularity of CSR has influenced the business.......................................................................3
3. Different types of leadership style and use of suitable leadership style for Starbucks............4
4. Importance of organisation culture .........................................................................................5
5. Reflection ................................................................................................................................5
CONCLUSION................................................................................................................................6
REFERNECE...................................................................................................................................7

INTRODUCTION
In business environment number of people are working in different organisation that are
performing various jobs and operating the business effectively. In current period, all the world is
facing pandemic (Covid- 19) that is serious issues and become a challenging point for
organisation to manage their sales accurately because people have closed to buy products and
shopping (Bartikand et.al., 2020). This report is based on Starbucks Corporation that is American
multinational chain of coffee houses and roaster reserves. This organisation was founded in
March 1971, by Jerry Baldwin. This is larger organisation that operates over 30,000 locations
worldwide in more than 70 countries. This report helps to increase the business performance by
operating and managing the task but due to Covid-19 its operation get hamper and reduced the
productivity. This report covers SWOT and PESTLE analysis, how popularity of CSR
influenced the business, different leadership style and application of suitable and importance of
organisation culture on the process of Starbucks. The second part of report covers reflection on
personal experience.
Main Body
1. SWOT and PESTLE analysis for Starbucks
In business environment many organisation are established where it is important to have
focus on activities and task that needs to be complete. Starbucks is a multinational coffee house
that is selling different flavour and taste of coffee which influence customers. This is a big brand
that purchases and roasts high quality whole bean coffees and sells them along with rich brewed
coffees. As happing of pandemic al most all businesses affected negatively that are shown by
using PESTLE analysis:
PESTLE analysis: This is a framework which uses by organisation to analyse the
situation of business and make the strategies accordingly. If environment is properly analysed
then it will be easier to establish and operate the business in changing environment and manage
performance. The PESTLE analysis for Starbucks are as defined:
Political: This factor is related to government where organisation needs to follow all new
regulation that are made by government such as tax rates, fiscal, change in trade and etc. In 2019,
when new virus (Corona) begun to emerge in China, UK and any other countries Starbucks made
decision to close most of its stores for helping the stop the spread this virus. Government has
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made new regulation that no one is allowed to open their shops and business during lock down
period which affected sales as it decreased and no earning has been generated (Sousa, and
Rocha,2019).
Economical: The basis of business is economical conditions that shows UK is developed
area where all inflation rates, interest rate, GDP rates and employment rate are stable which
helped businesses to operate. Due to Covid -19, the economical condition of all country
hampered highly as increased rate of unemployment, less purchasing power of customers.
Starbucks is facing problem operating business as inflation rates are increased in UK and other
countries which reduced the spending power of customers and reduced the productivity.
Social: As society is important for a business where number of people are living and
demanding different types of products which become an opportunity for businesses to regulate it
well. After Covid -19 coffee house Starbucks and other business get impacted badly as taste of
customer is totally changed, now people believes in natural juice which made of Aloe vera, Holy
Basil, Giloy, and any other natural leaves that make safe from virus and keep healthy resulted
negative impacts on chosen organisation. This can be opportunity if management has started to
provide coffee which made of natural leaves and provide good health from spreading virus then
it would attain the targets easily.
Technological: For running business it is required to use new technology and innovation
that can help to increase performance and profitability. The management of Starbucks is highly
skilled and experienced person who made efforts to face the complex situation as pandemic
which impacted negatively on performance. By using new technology Starbucks uses strategic
marketing and co-branding arrangements, like 24-hour Starbucks Hear music, TM digital music
channel, availability of wireless broadband internet service that can help to add new as well as
existing customers. Moreover, in pandemic this uses new technology that can provide safety to
customers that may impacts positively (Walsh, Bhagavatheeswaran and Roma, 2019) .
Legal: Once who decided to do business it required to follow all legislation that are
important and related to business. In Starbucks number of employees are working who belongs
to different place. After epidemic situation customers fear a lot and stopped to use outside goods.
In this situation, Starbucks follows all government regulation as for opening and running
business there is need to maintain hygiene, proper sanitize hand, table and cups that helps to stop
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spreading virus. This factor assures customers and feel good to having coffee and tea that
increases performance.
Environmental: Starbucks is managing all activities and performance by maintaining
good environment, reducing carbon effect, solar energy and reducing wastage that affected
business positively.
SWOT analysis: This framework is related to business that states internal position of
business and manage the activities. The SWOT of Starbucks are as defined:
Strength Weakness
 Starbucks is having global recognition
and popular brand.
 Visionary leader
 This has strong financial foundation.
 Higher customer satisfaction
 Making higher profits.
 Keeping high price that influence only
profile customers.
 Excessive focus.
 Importing roasted coffee
 Changes in government regulation
Opportunities Threats
 Entrance in new markets mostly in
European and Latin American market.
 Launching new products.
 Expansion of market and distribution
 Creation of employment
 Use of new technology and changing
products.
 Occurrence of natural problem like
Covid, flood, disaster, any other
pandemic
 Increasing cost of coffee beans
 Switching coffee products to vegetables
 Less demand of original products
2. Popularity of CSR has influenced the business
CSR is the main activity for organisation that should be consider while operation and
increases the performance and brand image. This deals with organisation's voluntary activities in
relationship of society and community. For all organisation CRR become higher priority as it
recognise number of benefits to their business. From the task 1 it has analysed that without
participate in CSR it will be difficult for organisation to maintain customer trust and offering the
better quality of products. Starbucks is larger size organisation that sales different flavour and
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design of coffee that can help to increase the business performance. This influenced business as
customers start to maintain trust and believes that organisation is providing better quality of
products. The Starbucks is addressing the CSR goals as by participating social responsibilities it
maintain better brand recognition, save operational cost, positive brand reputation, better
financial performance, and increase organisational growth that can help to increase the
organisational performance by attaining goals (Achinas, and et.al., 2019) .
Responsible business reputation: CSR activities helps Starbucks to build reputation as a
responsible business and after Covid-19 it become serious to maintain well hygienic workplace
that leads competitive advantages.
Cost saving: By reducing resource use, emission, wastage and others can help Starbucks
to maintain healthy environment and save money too.
Reduce regulatory burden: By CSR, Starbucks maintain good relationships with local,
national and international communities and authorities that make doing business easier.
3. Different types of leadership style and use of suitable leadership style for Starbucks
Leadership style is defined as manner and approach that provides right direction,
situation, implementation of plans, and motivating people that can help to increase the business
performance. Different types of organisation such as small, medium and large are operating in
contemporary business environment where it is important to analyse business situation and use
appropriate leadership style that can help to complete task and manage the good performance.
Types of leadership style
Democratic: This leadership style based on input of each team member that is effective
leadership style can help to complete task by assigning the work between employees. Moreover,
in this, decision is made by leader by concerning with all working employees that can help to
mange good performance (Abasilim,Gberevbie, and Osibanjo, 2019).
Autocratic: This is less effective and inverse to democratic in which decisions are taken
by leader without concern with employees. Herein, all authorities and power is holding by single
person who analyse situation and make decision (Donthu and Gustafsson, 2020).
Transformational: This leadership mainly uses in large organisation where changes and
improvement are needed regularly. Often employees have basic set of task and goals that are
completed by them every week and month but transformational leader always try to pushing
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employees to come outside from their comfort zone so they bring changes and shares with
employees that help to increase performance (Mauri, 2020).
From the above Transformational Leadership is adopted by Starbucks that is suitable
and feasible style in which leader bring changes and share with employees by describing
deadline that helps to complete task on time and maintain good performance. The reason behind
selecting this in autocratic leader give order and show rob that create conflicts and does not make
effective work or in democratic leader and employee does not think to come out from their daily
work and not to accept changes easily. After Pandemic and before this, when ever organised felt
needs of changes then it brought easily with the help to leaders and working with employees
(Khan, Jabbour, Mardani, Wong, 2020).
4. Importance of organisation culture
Organisation culture is set of values, believes, tradition, and activities that need to be
consider while managing the activities and operation. The different types of organisational
culture are role, task, power, and person that are uses by companies according their requirement
which can help to operate and manage the business performance. This is important for
organisation to adopt culture and increase the sales. For instance, If Starbucks is adopting right
culture then it can manage and organise all function accurately and complete the task on certain
time which can help to increase performance. Starbucks is adopting role culture in which roles
and responsibilities of employees in different activities and organisational process that can help
to increase sales and profitability (Fairlie, 2020).
5. Reflection
While preparing report and research I have increased my knowledge and skills that
helped me to conduct the analysis and complete the research. In starting I was nervous to from
where I will collect the information and how they are valuable. In meanwhile knowledge and
data analysis skills have been improved which helped to make me confident that I am doing
right. I noticed that a heavy loss has suffered by business organisation due to pandemic and I also
fear from spreading out this virus as I was collecting the information. In this, I increased my
leadership skills where I made a team and assign the role between team member so research will
complete on time and can help to increase the performance. I extremely happy to prepare this
project and felt that my leadership skills, time management, written skills, data management,
motivation skills have been improved that helped to complete task and manage the risk which
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arisen at the time of research. In between my communication and mathematical skills was weak
that could create problem but I handled all smoothly. This is showing that I am enough capable
to manage function, event, programmes. This research benefited in applying the different
theories such as leadership, management and high productive theory that helped to maintain a
practical framework and to come out from difficulties. Uses of innovation and new technology
helped me to bring new point in research and how I get new ideas to improve the knowledge. In
Pandemic I communicated and coordinate with people by using online sources that make healthy
and keep away from spread virus. Therefore, this research helped me to collect data and
complete research.
CONCLUSION
From the report it can be concluded that for running a business it is important to analyse
the environment and know how factor are affecting their business. The management is playing
vital role who conduct an analysis and make strategies which can help to operate a business
regularly. Organisation culture is important that should be adopted to complete task and attain
goals. PESTLE and SWOT analysis uses to conduct environment analysis and introduce factors
that affects Starbucks.
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REFERNECE
Books and Journal
Bartik, A. W., and et.al., 2020. The impact of COVID-19 on small business outcomes and
expectations. Proceedings of the National Academy of Sciences. 117(30). pp.17656-
17666.
Donthu, N. and Gustafsson, A., 2020. Effects of COVID-19 on business and research. Journal of
business research. 117. p.284.
Fairlie, R. W., 2020. The impact of COVID-19 on small business owners: evidence of early-
stage losses from the April 2020 current population survey (No. w27309). National
Bureau of Economic Research.
Khan, S. A. R., Jabbour, C. J. C., Mardani, A. and Wong, C. Y., 2020. Supply Chain and
Technology Innovation during COVID-19 Outbreak.
Mauri, C., 2020. What comes to mind when you think of sustainability? Qualitative research
with ZMET. Worldwide Hospitality and Tourism Themes.
Achinas, S., and et.al., 2019. A PESTLE Analysis of Biofuels Energy Industry in
Europe. Sustainability. 11(21). p.5981.
Walsh, K., Bhagavatheeswaran, L. and Roma, E., 2019. E-learning in healthcare professional
education: an analysis of political, economic, social, technological, legal and
environmental (PESTLE) factors. MedEdPublish. 8.
Sousa, M. J. and Rocha, Á., 2019. Leadership styles and skills developed through game-based
learning. Journal of Business Research. 94. pp.360-366.
Abasilim, U. D., Gberevbie, D. E. and Osibanjo, O. A., 2019. Leadership styles and employees’
commitment: Empirical evidence from Nigeria. SAGE Open. 9(3).
p.2158244019866287.
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