Starbucks Business Report

Starbucks Business Report

TABLE OF CONTENTS
PART 1............................................................................................................................................1
Introduction.................................................................................................................................1
External Environment analysis...................................................................................................2
Internal environment analysis.....................................................................................................7
Recommendations.....................................................................................................................11
PART 2..........................................................................................................................................12
A Presenting the list of stakeholders ........................................................................................12
B Profile of Starbuck customers...............................................................................................12
C................................................................................................................................................13
REFERENCES..............................................................................................................................14
APPENDIX ...................................................................................................................................16
A................................................................................................................................................16

PART 1
Introduction
Starbucks is a US based coffee company that is also having coffee house chain. Starbucks
corporation was founded in the year 1971 having its headquarter at Washington, US. At present
the business is operating in more than 30,000 different locations all over the world. The different
products that the business produce is coffee beverages, smoothies, tea, baked goods and also
sandwiches. There are about 291,000 trustworthy employees that are working of the
organisation. Basically, the business is the most prestigious and recognised brands for its premier
coffee brand and is also having different stores that provides its customers a stress free
environment (Mason, Cole and Goza, 2017). Company is having market share of 39.8% around
the globe.
The major competitors for coffee beverage sales are different coffee shops namely
Dunkin’s brands Inc., Mc-D etc that are offering to the customer’s premium products and
services. Starbucks is having its major competitors from US market and also in international
market. There are different quick service restaurants that are becoming tough competition for the
business and also ready to drink coffee beverage market. There are also retailers for prime retail
locations that are operating for both new and existing market and becoming competition for
Starbucks. Starbucks is having an effective competitive position in market and is fighting with its
different competitors that are Dunkin' Donuts and also McDonald's. From several years,
Starbucks is keeping its position in market as coffee king by adopting an effective marketing
approach. However, Dunkin' Donuts is also giving tough competition to Starbucks in terms of
the taste and quality. Not only this, business is also working on its pricing strategy as the cost of
Grande latte at Starbucks cost about $3.65, but Dunkin' Donuts provide the same at a cheaper
price that is about $3.29. Not only price wise but also flavour wise, Dunkin' Donuts is giving
tough competition to Starbucks. They both adopt generic strategies differently and Dunkin'
Donuts is having its major focus on low cost of its offering, while Starbucks works to make its
products differentiable.
McDonald's as a restaurant is also giving tough competition to Starbucks. But business is
getting high rank from the customers as compared with that from McDonald's and Dunkin'
Donuts. Starbucks is getting competitive advantage for its brand image as they work effectively
for their sustainable products and services. However, they are somehow lacking behind with
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respect to their pricing strategies as they are offering their products at premium prices and
McDonald's here beat them by offering the products at reasonable price for its customers.
However, customer base is quite large for Starbucks due to their focus on quality and customers
service. Starbucks is having large and differentiated product range that gives the business a
strong competitive advantage from these coffees' house and restaurants. With respect to the
working employees also, Starbucks is having an effective position and competitive advantages as
the working staff is known for their best services and creativity.
External Environment analysis
PESTLE analysis:-
It is a framework that is used by business in order to understand different macro-
environment factors and their impact on the business performance. The different macro-
environmental factors that impact Starbucks are as following:-
 Political factors:- There are different political factors that impacts the performance of
Starbucks like government policies, foreign trade policies, labour law etc. There are
different countries from which Starbucks buy its raw material and these countries are
having different policies and regulations that directly impact the business. Bureaucratic
red tape in different countries also impact the decision making of Starbucks and also
makes the business expansion more difficult for its business. However, regional
integration of markets brings opportunity for the business so that they can expand its
business globally and government of US is providing full support for infrastructure
development that helps the business to reach its potential market (Rastogi and Trivedi,
2016).
 Economic factors: - There are different economic factors like inflation rate, interest rates
and exchange rates etc. that impact the Starbucks. With the high economic growth and
employment opportunity to all developing countries, Starbucks gain more revenues from
different markets. However, business is also getting impacted with rise in labour cost as it
increases the business spending. Economic factors are directly associated with the
purchasing power of customers. Hence, in the case of having undesirable economic
condition Starbucks would not become able to attract more sales and profit.
 Social factors:- There are different social factors like norms, customs, lifestyle, health
and safety etc. that Impacts the business. With the growth in culture of coffee, Starbucks
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