Starbucks Global Business

This presentation discusses the history of Starbucks global business, challenges faced by the company in the Italian market, what Starbucks can learn from the Australian experience, Starbucks operating with humility and respect in the Italian market, the social responsibility of Starbucks in Italy, and the corporate strategy and goals of the company.

STARBUCKS GLOBAL BUSINESS
Name of the Student
Name of the University
Author Note

History of Starbucks global
business• Starbucks Corporation is an American coffee company and a coffee
house chain which was founded in Seatle , Washington in the year
1971. Presently the company is operating in 30,000 stores in different
locations worldwide e.
• The company Starbucks is considered as the main stream coffee
makers in the second wave coffee which initially distinguishes the
company from the other brands who deal in coffee production.
• Since the year 2000 companies re more focused in the second wave
coffee ad targeting the market with the quality marketed coffee
drinkers along with the hand made coffee with lighter roasts.
• Presently, the company is developing innovative ideas and
technologies to capture the market faster and increase the
productivity. (Sholihah, Ali & Prabandari 2016 )The company is using
automated espresso machines outside the stores for these who ant
an instant coffee. These machines are build for
safety and efficiency reasons.
• In America itself Starbucs is known for owning more than
over 1200 official stores and outlets with a revenue of US$700.35
million dollars.
• The company has also introduced the Starbucks mobile application
from where people will be able to purchase coffee and get it

Challenges currently facing the company
regarding its planned entry into the Italian
market
 Italy is a developed economy with the wealth of
potential , but with the cultural characteristics
and the involvement of the other layer of the
bureaucracy the new business institutions are
constantly leaving the country (Honack & Waikar,
2017).
 But with the modern development of the country’s
infrastructure as well a the well developed
economy attracts many business institutions
inside.
 Acknowledging various factors the following slides
will discuss the challenges which re faced by the
company in Italian market.

Challenges faced in
the Italian Market
 Starting a business - In Italy a company if
wants to expand its business ahs to first
deposit 25% of amount in cash to the
government before executing to a public
deed of operation and sorting out the
right procedures of accountancy.
 Dealing with the constructional permits –
In Italian market it will take a time period
of 130 days just to get a estimation of the
application submitted to the company.
According to dealing Beamish, Morey &

Continued …
 Getting access to the electricity - In terms of
getting a proper electric connection from the
external source it almost takes more than
100 days. Also simply getting the estimate
after the application will take the company a
average of two months time.
 Registering property – The company will also
have to face a steep challenge when it
comes to registering the property. Under the
certification of Attestato di Certificazione
Energetica, ACE. Th company will have to pay
a huge amount of money for the certification.

Continued …
 Getting credits and protecting the
investors – Italy is stuck with a global
credit crisis from the year 2017 which
ahs resulted in the capital flow of the
corporations. Also the World Bank has
dropped several places from getting
credit in a year.
 Paying the taxes – The Italian tax
system is much of a painstaking
situation. The company will have to
make more than 15 payments of tax
which will take the company to spend

Continued …
 Trading across the borders – Trading which
includes the exporting and importing of the
go0ds from the manufacturing companies .
The trading companies and agencies in
Italy usually takes 19 days to export
articles and commodities. Also it takes
almost 18 days to import articles.
Furthermore the authorities takes 10 days
just to process the required documents and
supply the necessary commodities.
Therefore it will be a challenging factor for
Starbucks to trade the raw materials from
the manufacturing countries.

Continued …
 Enforcing the contracts – According to the author
(Lewis,2017). Italy is known to ranked as the
world’s worst countries in enforcing the contracts.
It take a massive of more than 1200 days to
complete the Organization for Economic Co-
operation and Development (OECD) which as
compared to the other countries takes less than
500 days. Considering the long 41 procedures also
seems to be much surprising (Rayner, 2018).
 Resolving the insolvency – For the new companies
which are planning to open business in Italy it will
take the company a 1.8 year to resolve the
insolvency which will cost the company of average
22% of the estate.

Continued …
 Culture – The traditions and a sense of
history also plays a very powerful role
in the minds of the people who stay in
the country. According to the author
***** the company will have to pay high
sum of money in order to reach the
decision which acne be very lengthy
process and also in building relationship
.

What can Starbucks learn
from the Australian
experience The coffee industry in Australia is more
than $3 billion a year. The stores in the
country was already mature when it
was first opened in the year 2000.
 The Australia’s largest migrants are
mostly fro the surrounding countries
like Greece and Italy. They have a
tradition of having coffee in the
morning. The people in Australia have
also started adopting the routine
process of morning coffee.

What can Starbucks learn
from the Australian
experience Starbucks is known to own failure in the Australian
market despite of having most of the coffee lovers.
The Australian market is mostly composed of the
fast food market which is helped by the
government.
 The bargaining power of the consumers are the
strongest in the case of Australia and most of the
consumers here are youth who prefer fast foods
over the coffee.
 The company already had 6200 coffee stores and
other establishment in shopping malls, local
restaurants but it could not compete the fast food
chain of Gloria Jeans and Mc Donald who were very
hard to beat.

Starbucks operating with
humility and respect in
the Italian market
 Howard Schultz who was the company
CEO had decided to open a store in
Australia thirty three years ago. It got
the craftsmanship of the company
Milnese Barista which I the spirit of the
Italian people. Taking a note of the
passion for the community, their
friendliness, and the taste for the best
quality, Starbucks achieved a vision of
achieving the market.

Continued …
Therefore Starbucks
decided to directly link
to the way the Italian
marketed the place.
The CEO of the
company is now trying
to re enter into the
Italian Market.
It has decided to make
an entry with great
humility and respect to
share what they have
been doing from the
past years. The
company will be taking
much pain in

Continued …
 Starbucks has also chosen a partner company which is
Percassi. The company will be helping Starbucks to
develop stores in various cities beginning the firs one
in Milan. Thee partner company has also the vision,
mission of sharing the brand value and will combine
local expertise along with much demonstrated
business will help Starbucks in making success to
make each and every store an exciting, unique and
create a new experience for the new Italian customers.
 Both the companies share common values and a
commitment in creating a pathway to the youth and
finding new opportunities, also it has decided in
bringing more employment opportunities in the
communities right across Italy.

Demonstrate the social
responsibility of Starbucks
in Italy
 Starbucks has committed in helping
the communities to thrive everywhere
they do their business. They has thus
developed themselves in supporting
the connections in the communities all
around the world so that the company
can make a relevant, positive and an
enduring impact socially.

Continued …
 Whereas environmentally the company has
found out ways to minimize the environmental
footprints and tackle the climatic change.
According to (Gupta, Nagpal & Malik 2018).
the company is also working very hard in
inspiring others to do the same.
 They are also committed in buying and serving
the customers by providing them with the high
quality products, growth responsibility and
ethically traded coffee in helping to create a
better environment for the farmers.

Continued …
 The company has also a recycling
policy where the company reuses the
consumption of raw material and dos
not let the company to impact
environmentally. It will also help the
country by avoiding the corrective
actions and other efforts so as by
starting off right foot by serving the
people with reusable ceramic crockery.

Corporate Strategy
 Maximizing the market penetration
 Providing a relaxing , attractive social
atmosphere
 Offering high quality products
 Creating a great working environment
and achieving profitability.

Present and Future
Goals of the company

References
 Sholihah, P. I., Ali, M., Ahmed, K., &
Prabandari, S. P. (2016). The Strategy
of Starbucks and it's Effectiveness on
its Operations in China, a SWOT
Analysis. Asian Journal of Business
and Management (ISSN: 2321–2802)
Volume.
 Honack, R., & Waikar, S. (2017).
Growing big while staying small:
Starbucks harvests international
growth. Kellogg School of
Management Cases, 1-22.

References
 Beamish, P., Morey, P., Greive, C.,
Grant, R., & Guest, J. (2016). Caffeine
consumption among students
attending Christian schools in Australia
and its relationship to classroom
behaviour and academic performance.
TEACH Journal of Christian Education,
10(2), 10.
 Lewis, O. (2017). Starbucks (HK) Case
Note: The Ambiguous Limb of Goodwill
and the Tort of Passing Off. Victoria U.

References
 Rayner, J. (2018). The view from Australia: Is
Indonesia leaving us behind?. Australian
Foreign Affairs, (3), 31.
 Fiedler, J., & McGreevy, P. (2016). Reconciling
horse welfare, worker safety, and public
expectations: Horse event incident
management systems in Australia. Animals,
6(3), 16.
 Gupta, P., Nagpal, A., & Malik, D. (2018).
Starbucks: global brand in emerging markets.
Emerald Emerging Markets Case Studies, 8(4),
1-22.