Strategic Management of Starbucks Corporation

The report analyzes the internal and external environmental analysis of Starbucks Corporation and provides a strategic plan for the company's growth. It includes PESTLE analysis, Porter's Five Forces analysis, SWOT analysis, and more.

Running head: STARTEGIC MANAGEMENT
Strategic Management
Name of the Student
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Executive Summary
The report has thrown light on identifying and analyzing the internal and external
environmental analysis of Starbucks Corporation. From the analysis of the case study, it has
been identified that there are different kinds of threats and weaknesses internally and
externally such as high pricing strategy along with high level of competition has affected the
growth of the company negatively.
In such scenario, despite the positive outlook of the market of Starbucks, the company needed
to create a proper strategic planning and counseling as they faced the different challenges
related to the competition such as McDonald’s and other companies are growing by
providing the similar kind of products at a cheaper rate. Despite heavy challenges faced by
Starbucks, the analysis has been able to showcase the facts that Starbucks is well-positioned
in the market that has been helpful for the growth of the company in a positive manner.
The report has been meant to be the strategic kind of pathfinder which mainly aims at
illuminating the different kinds of strategic alternatives in the light of the different
opportunities along with threats that lie ahead in the long run. Moreover, the report has
provided with the proper utilization of the different strengths and opportunities which could
be used as the Key Performance Indicators in solving the issues and minimize the different
threats in a successful manner.

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Table of Contents
Background of Starbucks...........................................................................................................3
Situation Analysis......................................................................................................................4
The Environment- PESTLE Analysis....................................................................................4
1. Political environment.........................................................................................................4
2. Economic environment......................................................................................................5
3. Social environment.............................................................................................................5
4. Technological environment................................................................................................6
5. Legal/Regulatory environment...........................................................................................7
6. Environmental environment...............................................................................................8
The Industry- Porter’s Five Forces Analysis.........................................................................9
The Firm...............................................................................................................................13
Mission and Vision of Starbucks.....................................................................................13
Strengths of Starbucks......................................................................................................14
Financial Condition of Starbucks.....................................................................................14
Constraints and Weaknesses of The Firm........................................................................15
Management Philosophy..................................................................................................16
Analysis of Organization Structure Relating to Decisions Made....................................16
The Product..........................................................................................................................17
Goods or Services Offered by Starbucks.........................................................................17

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Analysis of Needs of Customers Solved by Starbucks....................................................17
Analysis of Promotional Mix, Channels of Distribution and Pricing Strategies Used by
Starbucks..........................................................................................................................18
Analysis of Competitive Advantage Offered by Marketing Strategy..............................18
SWOT Analysis...................................................................................................................19
Problem Statement...................................................................................................................20
Strategic Plan...........................................................................................................................21
Development of 5-year Strategic Plan for Starbucks...........................................................21
Clear Vision, Mission and Core Values...........................................................................21
SMART Objectives to Solve Problem.............................................................................21
Corresponding Strategies for Objectives Identified.........................................................22
Implementation Plan........................................................................................................22
Key Performance Indicators to Monitor Progress............................................................23
Summary..................................................................................................................................23
References................................................................................................................................25

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Background of Starbucks
Starbucks Corporation is one of the Multinational Company that mainly specializes in
the sales and production of the different coffee related products which is inclusive of the roast
coffee along with the other coffee related products and drinks globally. The company was
incorporated in the year 1987 as the coffee roasting organization situated in Seattle,
Washington by the three major owners who tried to learn the concept of preparing the coffee
and roasting from the local Italian retailer. In the current scenario, the respective company is
operating in more than 30000 locations in the worldwide. The number of employees working
in the company is 291000 till the year 2018 and it has helped the company in gaining
profitability in a successful manner (Starbucks.com, 2019). Moreover, the revenue which has
been earned by Starbucks is US$24.71 billion till the year 2018 and in the present scenario,
Starbucks uses automated espresso machines for safety reasons along with efficiency.
In order to achieve the strategic goals of the expansion of the business which helps
them in serving the demands of the customers in the market of the hospitality industry,
Starb0ucks adopted the different strategies wherein the main aim and objective was aimed at
increasing the overall productivity which helped in increasing the output related to sales in a
positive manner. The major strategy which was involved was the proper expansion of
business of Starbucks through opening the several outlets in United States and in other
countries within the year 2010 ((Starbucks.com, 2019). Additionally, the respective company
has been able to adopt the different internal strategies related to business for improving the
overall productivity wherein the main focus was on the welfare of the different employees
who are employed with Starbucks.
The analysis of the case study helps in analyzing the different steps that Starbucks
Corporation has adopted their effort which assists them in expanding the business operations

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through the analysis of the external and internal environments of the organization.
Additionally, the analysis helps in highlighting the strengths along with weaknesses which
the company has experienced in the last few years and the different strategies which have
been implemented by them for generating success. There will be strategy formulation long
with other recommendations that can be provided to the company for managing the future
prospects of the company for achieving the success in the respective industry suitably.
Situation Analysis
The Environment- PESTLE Analysis
1. Political environment
The main political imperative which has been faced by Starbucks is the different
concerns which is related to the sourcing of the raw materials which has been able to attract
the attention of the different politicians in West and in the other countries from where it
sources the different raw materials (Aguinis, Edwards & Bradley, 2017). It is the major
reason due to which Starbucks is keen on proper adherence to the environmental along with
social norms as well as follow sourcing related strategies which are appropriate in nature and
it will be appropriate for the Fair-Trade practices for both developed and developing
countries.
The other political aspect is the differ/ rent kinds of political and regulatory policies
along with pressures within United States as there is larger amount of scrutiny of the business
processes which are now subjected in the market of United States (Aithal, 2016). In addition,
the other political kind of imperatives which should be analyzed in the respective scenario is
relating to the adhering to the different rules and regulations in various countries from the
country wherein the raw materials are being sourced.

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2.Economic environment
In the respective scenario, the most essential economic driver for Starbucks is related
to ongoing global kind of economic recession which affects the overall profitability of the
company in a negative manner (Bergh et al., 2016). From the different studies, it has been
seen and analyzed that the customers instead of cutting down on the consumption of the
coffee, they are shifting their focus on the different cheaper alternatives and it will be
becoming the opportunity for Starbucks.
Moreover, the decline in the rate of the unemployment is the other aspect that can be
created as the opportunity as it will be providing Starbucks with different kinds of
opportunities that will be suitable for attracting large number of customers in the market and
as the firm sources the coffee beans from the different developing countries which was one of
the major opportunities for Starbucks in meeting the different needs of the customers suitably
(Bettis et al., 2014).
3. Social environment
From the different analysis, it can be seen that Starbucks can be offering cheaper
priced products such as coffee and other items to the customers in the market, however the
same is required to be performed without sacrificing the quality of the coffee (Boyd et al.,
2013). However, from the same, it can be analyzed that it is the key socio-cultural challenge
for the company while expanding the base of the customers for including the consumers from
the lower or the middle tiers of the income related pyramid.
Apart from the same, the ethical and green chic related consumers who fret regarding
the different kinds of environmental and social costs of the different brands and it can be
ineffective for the growth of the company negatively as well. In such scenario, Starbucks is
trying their best in minimizing the environment related impact along with tackling of the

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different changes in the climate and inspiring the others in the market to perform the similar
kind of activities which will be beneficial for the success of the company in the future (Cania,
2014). Moreover, there has been increased health consciousness among the present
generation individuals due to which Starbucks need to be more ethical towards the
environmental stewardship that has helped them in improving the goals and managing the
overall effectiveness of the company in the future (Certo et al., 2014).
4. Technological environment
The different technological factors play a major role in shaping the different
appropriate organizational forms in a successful manner. Proper usage of the different
technological and innovative approaches will be leading to the overall improvement in the
services which are being delivered in the café and it will be leading to the enhancement of the
business-related activities (Chen, Delmas& Lieberman, 2015). Starbucks in the respective
aspect is well-poised in nature to reap the different benefits of the emerging mobile related
technology that has been helpful for them in showcasing the fact that it will be able to
manage the needs of the customers in a positive manner.
The company has been able to introduce the different Wi-Fi capabilities in the
different outlets present in the entire world that helps the customers in surfing the web
whenever they are in the café (Dälken, 2014). Due to the same, it helped in adding value to
the brand of Starbucks and it enhances the overall experience of the customers in the market
in an appropriate manner. in addition, the company has introduced the mobile payment
system which has been quite successful for the overall efficiency and it is something which is
already testing out in the pilot locations in the United States(David& David, 2013).

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5. Legal/Regulatory environment
There are different kinds of legal factors which are included in the PESTEL analysis
which is required to be analyzed regarding the analysis of the laws and regulations on the
business. Starbucks need to address the different legal factors in the remote or macro related
environment. In such scenario, the product safety rules and regulations play a crucial role and
opportunity for Starbucks as it suggests them in improving their performance through
satisfying the product safety related regulations that will encourage more customers to be
attracted towards the company (Durand,Grant& Madsen, 2017).
Additionally, Starbucks is performing excellent in the different aspects which are
related to the GMO related regulations outside the United States that can act as one of the
opportunities which will be suitable for them in delivering the quality products with proper
legal regulations which will be enhancing their level of efficiency in the market (E. Dobbs,
2014). In addition, Starbucks should always ensure the fact that they are not falling out of the
different rules and regulations in the different countries from wherein it sources the raw
materials and other products along with the home market in United States.
6. Environmental environment
In the respective aspect, there are different kinds of concerns regarding the business
practices of Starbucks from the various kinds of activists. The international advocacy groups
along with different consumers that can affect the overall effectiveness of the company in a
positive manner (E. Dobbs, 2016). The growing popular support for responsible is the other
opportunity which will be helpful for Starbucks in emphasizing on the corporate social
responsibility that will be enhancing the growth of the company in contrast to the competitor
companies present in the market.

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Therefore, in such scenario, Starbucks need to take into consideration the different
ethical concerns which will be suitable for them for enhancing the growth in comparison to
the competitors (Engert, Rauter& Baumgartner, 2016). Additionally, it is required to be noted
that Starbucks have responsible sourcing policies which provides Starbucks the opportunity
to offer more of their products through recyclable packaging and it will be playing a vital role
in the growth of the company in the future.
Therefore, from the help of the PESTEL analysis, it can be identified that most of the
different external related factors in Starbucks Coffee that are present the different kinds of
opportunities which will be suitable for the overall growth of the company in a positive
manner. However, on the other hand, the company needs to work as to address the different
recognized threats especially the different threats of the substitution which are present in the
market due to the increased availability of the different home-used specialty coffee related
machines. On the contrary, Starbucks cannot perform much but to avoid threat of the
bureaucratic red tape. From the overall analysis, it can be identified that PESTEL analysis
framework helps in indicating the fact that Starbucks have plenty of the room for the future
global growth in the successful manner.
The Industry- Porter’s Five Forces Analysis
In case of the respective organization, it can be analyzed that Starbucks Corporation
successfully grows through the effectiveness of the management in addressing the different
impacts of the five forces model in the entire global coffee industry and coffeehouse industry
related environment as well. Moreover, the respective model provides the proper information
which will be related to the strategic management for addressing five forces such as
competitive rivalry, bargaining power of the suppliers, bargaining power of the customers,

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threat from the new entrants and threat from the different substitutes which are present in the
market (Galliers&Leidner, 2014).
In addition, in the respect of the external analysis related case, Starbucks need to
operate in the business environment which will be involving the strong level of competition
with the other competitors such as the different coffee companies in the market along with
the good beverage companies such as Dunkin Donuts, McDonald’s along with Burger King
which can prove to be the strong competitors in the market.
Competitive Rivalry- In the respective scenario, Starbucks faces strong force in the
coffeehouse related industries or the other food service. In case of Starbucks Coffee
Corporation, there are different external factors which helps in contributing to the strong and
fierce level of competition in the market which is inclusive of the different factors which are
analyzed in the following manner:
There are different large number of firms present in the market that is the strong force
wherein it can be seen that these large firms are the external factor which intensifies the
competitive rivalry against Starbucks (Gallus& Frey, 2016). The company have different
kinds of competitors present in the market which are in different sizes and in the respective
relation, the population or the number of competitors which are present in the market is less
in number as well. In the analysis of the Five Forces Model of Starbucks, the moderate
variety present in the market furthermore helps in strengthening competition level in the
respective industry.
Moreover, due to the low cost related to switching can be one of the major
disadvantages to the different customers while shifting from specific provider or producer to
the other present in the market. For instance- the respective case includes the minimal
disadvantages to the different customers who transfer from the organization to the other

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coffeehouses (Ginter, Duncan& Swayne, 2018). Based on the respective component, the
competition is among the top priority challenges in the company and it affects the overall
efficiency in a negative manner. The different corporate generic and growth strategies can be
helpful for Starbucks for reflecting on the different strategic kind of responses to the
competition.
Bargaining Power of Buyers- In case of Starbucks, the company has different
experiences regarding the strong kind of force or the bargaining power of the customers in
the market. In the five forces model, the entire force is dependent on influence of the
customers or the group of different customers on the business environment which is
international in nature. In case of Starbucks, different external kind of factors help in
contributing towards the strong bargaining power of the customers which is inclusive of the
following:
Based on the low costs related to switching, the customers of Starbucks can shift their
focus to the other brands other than Starbucks. In addition, high availability of the different
substitutes which means that the customers can choose the other alternatives present in the
marekt as there are introduction to the different instant beverage companies which are from
vending machines (Greco,Cricelli& Grimaldi, 2013). However, on the other hand, despite
such weakness, two other external factors which strengthens the bargaining power of the
customers in the market and therefore, the bargaining power of the customers is the most
common strategic issue in the market. In such scenario, Starbucks marketing assists in
strengthening the brand of the company and address the bargaining power of the customers.
Bargaining Power of Suppliers- In the respective scenario, Starbucks Company faces
the weak force in the bargaining power of the suppliers. In such scenario, the judicious size
of the different suppliers is the external factor which creates judicious force on Starbucks. On

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the contrary, large number of substitutes tries to weaken the bargaining power of the
suppliers (Guerras-Martin, Madhok& Montoro-Sánchez, 2014). For instance- The different
suppliers have different kinds of competencies which assists them in competing against one
another as the main aim is to generate revenues and gain profitability through supplying the
different products which is inclusive of coffee beans to the respective company.
On the other hand, there are other issues such as there is inclusion of different
suppliers of tea and coffee around the world that can lessen the efficiency of the ones
supplying the different kinds of raw materials to Starbucks (Gupta, 2013). The other
consideration is the policy of the company for diversifying supply chain as the technique of
addressing trends which can be identified in PESTEL analysis. Such kind of policies weakens
the power of suppliers; however, it is the strategic issue which is minor in nature.
Threat of Substitutes- It is the other aspect wherein it can be seen that Starbucks
facing and experiencing the strong force of substitutes present in the market. The high
substitutes availability in the market can negatively impact the ability of Starbucks in gaining
revenues in the market. It makes easy for the different customers to buy the similar kind of
products from other substitutes which are available in the market and it affects the
profitability and revenue generation of Starbucks (Hahn, 2013). For instance- There are
different ready to drink beverages along with instant beverage powders which are readily
available in the market such as supermarkets or convenience stores (Mahoney& Qian, 2013).
Additionally, the low costs related to switching helps in strengthening the threat of the
different kind of substitutes instead of products of Starbucks. Moreover, the different kinds of
substitute products which are available in the market are reasonably priced (Jackson,
Schuler& Jiang, 2014).

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Threat of New Entrants- In the respective scenario, Starbucks faces the moderate
force from the threat of the new entrants and this force helps in determining the number of
new companies which are making their position in the market and it can affect the growth of
Starbucks ineffectively (Kaiser et al., 2015). The judicious type of cost of performing
business is actually connected with variability of the different costs which helps in
maintaining the different functions in the respective coffee industry. For instance- The
operating costs for operating the small coffee shops is cheaper in comparison to the other
large coffee chains. In the respective relation, the smaller type of cafes have the lower needs
related to supply along with corresponding the costs related to supply chain (Karadag, 2015).
From the respective example, it can be identified that these kinds of external related
factors help the different other firms which are small in nature for performing the business
along with competing against the Starbucks Corporation. On the contrary, the development of
the brand is costly, the condition reduces the threat of substitution. Moreover, the high cost of
the development of the brand is the weak force which can affect the growth of Starbucks as it
can affect the growth of the firm negatively.
For instance- In such scenario, the company can implement the respective strategies
which will be making the brand stronger and the respective recommendation is intended
which will be addressing the strong force of the rivalry, the strong bargaining power of the
suppliers and buyers and the huge threat of the substitution (Karadag, 2015).
The Firm
Mission and Vision of Starbucks
Mission
The corporate mission statement of Starbucks is to “inspire along with nurture the
spirit of the human beings- One cup, One Person and One Neighborhood at a time”. From

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the mission statement, it helps in reflecting the different efforts which are being taken by
Starbucks in running the business. The major components of the mission statement of
Starbucks is to influence the strategic management in growing the business of the company
which starts with the different employees. In order to maintain the respective culture,
Starbucks tries to maintain the small company related culture wherein warmth and rapport are
essential.
Vision
The major vision of Starbucks is to establish Starbucks as one of the most premium
purveyors for selling the finest coffee in the entire world along with maintaining the
uncompromising the principles while we grow. Along with delivering the different
customers, Starbucks prefers to achieve the active leadership in providing the products to the
customers especially providing the different customers with the best kind of coffee in the
world and gain competitive advantage in the market (Starbucks.com, 2019).
Strengths of Starbucks
The most intangible strength of Starbucks includes the top of mind recall among the
different customers along with the virtue of the brand that assists in symbolizing the
excellence and the quality of the coffee and other products at an affordable product. In such
scenario, the organization enjoys the dominant type of position in the worldwide market for
the coffee along with beverages (Starbucks.com, 2019).
Financial Condition of Starbucks
In the year 2018, Starbucks Corporation reported the earnings of more than 4.52
billion US dollars and the revenue which has been earned by the company is 2471 crores
USD till the year 2018 (Starbucks.com, 2019). From the different ratio analysis, it can be
identified that Starbucks have become more profitable over the last few years wherein the net

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income rose to 143% from 2010 and the company has been able to share the profitability with
the different shareholders of the company (Mathooko&Ogutu, 2015).
Figure 1: Liquidity Ratio of Starbucks
(Source: Starbucks.com, 2019)
From the financial analysis, it can be identified that Starbucks has been able to gain
the strong position in the market and it has been successful for them to gain huge market
share and it helped them in earning more revenues in a short span of time. Concerning related
to the liquidity ratio of Starbucks, the main conclusion is the fact that the liquidity ratios have
been increasing from 2010-2013 which indicates the fact that the ability to pay off the debts
for Starbucks has improved to a large extent and it is suitable for the growth of the business
in the future.
Constraints and Weaknesses of The Firm
The major constraints or the weaknesses of Starbucks is the high price point as the
hefty price tags on some of the products which are being sold by Starbucks plenty of the
different customers who might have considered Starbucks to be the part of their daily lives
due to which it affects their profitability (Morschett, Schramm-Klein&Zentes, 2015). In
addition, there is organizational conflict among the workers of the company and the top
management as there is communication gap which affects morale of employees and due to

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the same, there are different employees who are leaving the job and trying for other better
opportunities in the respective field. Due to the organizational conflict, it has created major
losses for Starbucks and due to the same, there was major breach of agreement with Kraft
which used to sell them coffee cups.
Management Philosophy
In case of Starbucks, the main management or the business philosophy is
“EMPLOYEES FIRST” as CEO of Starbucks commented the fact that Starbucks brand has
been built first with employees and not customers. As the management of the company
believed the fact that most effective way of meeting as well as exceeding the different
expectations of the customers was to hire along with train the employees and therefore, they
invested their time and effort on employees (Noe et al., 2017). According to Howard, the
company needs to connect with the employees and second with their customers as Starbucks
knows that employees are treated well, it will be in turn treat the customers in a suitable
manner.
Figure 2: Words of Howard Schultz
(Source: Strabucks.com, 2019)

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Analysis of Organization Structure Relating to Decisions Made
Starbucks Corporation follows the Matrix Organizational Structure which is
considered to be the hybrid mixture of the different features from the other types of the
organizational structure which is basic. For instance- The product-based department of
Starbucks intersects with the different functional groups along with geographic divisions and
it intersects with the other groups of the individuals. The corporate culture of Starbucks
includes the following:
 Efficient teams
 Divisions related to product-based aspects
 Functional related hierarchy
 Geographic related divisions
The Product
Goods or Services Offered by Starbucks
There are different kinds of beverages and food which are being sold by Starbucks for
their customers in the market. The beverages include brewed coffees, Italian style espresso
along with cold blended beverages and coffee liqueur (Powell, 2014). On the other hand, the
food items which are being sold by Starbucks includes sandwiches, salads, ice-creams along
with pastries which make them more efficient in meeting the different needs of the customers
in a suitable manner and improve the effectiveness in a strong manner (Abdel-Basset,
Mohamed&Smarandache, 2018).
Analysis of Needs of Customers Solved by Starbucks
Due to the quality coffee which is being provided by Starbucks for their customers
helps them in attracting more customers. For the different college students or the working

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individuals, Starbucks has been able to provide the different kinds of coffee and other
beverages which makes them more attractive (Rosenbusch,Rauch & Bausch, 2013). In
addition, Starbucks offer mugs along with accessories and packages goods that meets the
expectations of the customers.
Analysis of Promotional Mix, Channels of Distribution and Pricing Strategies Used by
Starbucks
In case of the promotional mix, it can be seen that Starbucks does not follow the
conventional advertising as thee company felt that there is huge level of competition and due
to the same reason, Starbucks has selected few charity related events to reach to the
community which is served by them (Blockeel et al., 2016). It helps them in inspiring people
inside and outside the organization and reinforce the value and image of the company. For
instance- On September 11th, the stores in New York and Washington D.C brewed coffee free
of cost for the different relief workers (Rothaermel, 2013).
Moreover, the pricing strategy adopted by Starbucks is Competitive Pricing Strategy
to match their pace with the other competitors (Simon et al., 2014). The competitive pricing
aspect helps in representing Starbucks an attractive combination of the features, high quality
along with excellent service and other attractive attributes that assists them in improving their
presence in the market.
Analysis of Competitive Advantage Offered by Marketing Strategy
The differentiation strategy related to products is the competitive advantage for
gaining the sustained competitive advantage. Starbucks offers such differentiation aspect with
the help of excellent experience to the customers along with quality coffee and the experience
provided by Starbucks is achieved with the help of well-designed stores with the proper

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ambience along with well-trained staffs that will be successful for the growth of Starbucks
(Simon, Fischbach&Schoder, 2014).
SWOT Analysis
Figure 2: SWOT Analysis Matrix of Starbucks
(Source: Created by author)
Strengths
The main strength of Starbucks is the uniqueness of products which has helped them
in keeping loyal customers and it has been growing over time. Starbucks has been able to
meet the different needs of the customers with inclusion of Wi-Fi that assisted them in
managing growth in a short span of time (Steiss, 2019).
Weaknesses
In case of weakness, the pricing adopted by Starbucks is high and it is not affordable
by all individuals. In such scenario, it has reduced affordability of the different customers
SWOT

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which led to decline in profitability of the company (Vogel&Güttel, 2013). Moreover,
Starbucks have their branches in Indian market and it is not approachable by the different
income group customers as the products are highly priced.
Opportunities
Starbucks have been able to expand their markets in various countries such as in
Indian market, they have their presence that has assisted them in growing and improve their
brand image (Xingang, Jiaoli& Bei, 2013). Due to the same, Starbucks has been approached
by different customers which enhanced the effectiveness of the company.
Threats
There is huge level of competition in the market wherein there are different coffee
producers and manufacturers which can threaten future stability of Starbucks which offers the
higher prices. In regards to the same, the products can be imitated which cause threat to
market position (Yuan, 2013).
Problem Statement
Primary Problem
The major primary issue which has been faced by Starbucks is the financial crisis in
world economy which is forcing them to call closures of the different stores in the entire
world. There are number of competitors which have been increased in the recent era that has
affected the profitability of the company along with it has affected the revenue generation
negatively (Zhao et al., 2017).
Secondary Problem

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Despite the current success which has been gained by Starbucks along with
undisputed market of Starbucks, the company faces different kinds of challenges in short to
medium term. The different analysts are reminded with the fact that the direct competitors
such as McDonald’s or Dunkin Breads are aiming to gain and attract more customers globally
who may go to Starbucks otherwise (Gürel& Tat, 2017).
Ramifications of Problems in Long Run and Short Run
In addition, Starbucks is unsure regarding the influence of growth strategy on the
emerging or developing economies along with the corporate performance. It is difficult to
understand whether the perceived opportunities are sustainable in nature or short winded. In
such scenario, proper strategic plan is required to be adopted by the company for improving
the growth prospects. The stock of Starbucks is down by 11.38% while the overall share in
the market is up by 4.10% (Starbucks.corp, 2019).
Strategic Plan
Development of 5-year Strategic Plan for Starbucks
Clear Vision, Mission and Core Values
After the analysis of the problem, it can be analyzed that the main mission, vision and
core values of the company which needs to be followed by Starbucks is relating to provide
the customers with the coffee and other products which will be suitable for the different
income group individuals (Starbucks.corp, 2019). The company needs to provide high quality
products at lower price and achieve profitability in a suitable manner.
SMART Objectives to Solve Problem
 To increase the market share of the company by 10% in the next five years
 To promote healthy products for the health-conscious customers

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 To generate sales promotional activities to compete with the other competitors
 To increase the marketing of products and services which will be suitable for the
growth of the company
Corresponding Strategies for Objectives Identified
Corporate Level Strategies
The SPACE matrix can be used for determining nature of corporate strategy of
Starbucks wherein the aggressive strategy can be used to become extremely defensive as it
will be emulating low pricing strategies of competitors.
Business Level Strategies
With the help of the strong competitive position through product and market
development by introducing the different coffee products that can be suitable for the different
countries as it will be enhancing the growth of Starbucks.
Implementation Plan
Activity
1-
8th
Marc
h
10
-15th
March
16
-18th
March
19
-22nd
March
23
-26th
March
27th
March-
04th
April
Proper Planning and Development
Development of Strategy
Crafting Strategy with supportive
corporate culture

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Exerting Strategic Leadership
Linking Budget to Strategy
Establishing Strategy through
Supportive policies and procedures
Instituting Best Factors
Analysis of the Competitors
Implementation of SMART
Objectives
Concluding the Study
Figure 3: Implementation Plan Table
(Source: Created by Author)
Key Performance Indicators to Monitor Progress
 Starbucks generates more than 70% of revenues through sale of beverages and 20%
from food sales and more than 3% from packaged and single serve coffees
 Through employee training, there can be improvement in the customer satisfaction
rate through on the job training and internet-based training (Starbucks.corp,2019)
 Revenue has grown from 13299 million in 2012 to 14892 in 2013 which is looking
attractive to shareholders

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Summary
Therefore, from the strategic management analysis of Starbucks Corporation, it can be
summarized and concluded that there are different kinds of issues which are required to be
solved with the implementation of the different strategic recommendations. Starbucks need to
adopt the aggressive expansion strategy in emerging markets as Starbucks have competition
position in market and due to the same, the company needs to utilize the internal strengths for
developing market share in the emerging economies. On the business level, the respective
company needs to develop successful product lines which will help them in attracting large
number of customers and build up the different other product lines which will be the suitable
aspect in the market.

25STARTEGIC MANAGEMENT
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