Starbucks Failure in Australia

Starbucks failure in Australia

Table of Contents
Introduction......................................................................................................................................3
Main body........................................................................................................................................3
Critical evaluation of Starbucks failure in Australia...................................................................3
Critical Assessment of reasons to global business environment which relates to Starbucks......5
Conclusion.......................................................................................................................................6
References........................................................................................................................................8

Introduction
The fact cannot be denied that Starbucks has the potential scope of expansion in Australia due to
a deep love for coffee of customers. Still, the company failed in the market. The above statement
is supported by the fact that Starbucks has accumulated losses of $105 million, and due to same,
it closed almost sixty-one stores. The present study emphasizes on the reasons behind Starbucks
failure in Australia and critically evaluates reasons relating to global business environment
regarding the failure of Starbucks
Main body
Critical evaluation of Starbucks failure in Australia
A coffee chain, Starbucks has suffered from great losses, and the company has faced the
situation of obscurity. Further, company sales get declined due to which 700 workers were
terminated from the company. At this phase when the reason behind its failure evaluated, then it
comes into view that company was prepared for achieving the global success, but made some
basic mistakes, for example, trying to be a premium brand by charging high prices for its product
and services. Further, the company did not succeed to fulfil the expectations of customers and
get unsuccessful in serving adequate products which resulted in poor customer service
experience (Butler, 2018). It was clear in the minds of Australians that Starbucks is not their cup
of coffee. But except Australia, the business of Starbucks is growing worldwide (Atzori,
Shapoval, and Murphy, 2018).
In Australia, the story of Starbucks provided valuable learning for all business entities. It is a
story of a company that looks for global domination in its sector and moves forward without
considering consumer preferences within a new market, i.e.without testing the waters. The
research has been done by Patterson and fellow marketing professor Mark Uncles with Jane
Scott, in association with the Australian School of Business and they stated the same above
specified reasons behind its failure (Hogan, and Broadbent, 2017).
In 2002 when Starbucks entered the market of Australia, it was considered as the biggest coffee
chain in the whole world. Every day new stores were opened somewhere in the countries. The