Competitive Position of Starbucks: Analysis and Strategies

Strategy

INTRODUCTION

Introduction of Starbucks and its competitive position
Starbucks is most popular coffee firm which has great coffee house chain. It offers wide
range of products to its potential buyers and always takes care of their taste and preferences. It
has branches across the world and has become the leading brand in this sector. Starbucks is
famous for using high quality whole bean in its items. In the year 2015, Starbucks has become
the world leader in this industry and has generated 16 billion revenues which was very high as
compare to other coffee retailers. Company is using licensing and franchising system to run
business worldwide. Its return on investment was 23.1% in the year 2015 whereas it was 6.8%
last year. Starbucks has made partnership with Apple company and I the year 2007 Apple has
given opportunity to its potential buyers that they can browse iTune of Apple at store of
Starbucks (Real and Percell, 2018).
Starbucks is very concern about environment hence, it has started using materials in very
effective manner. Recycling of papers has raised company’s image and also have supported in
reducing its operational cost to great extent. It has fulfilled its corporate social responsibilities
and organized food bank donation camp etc. The main key of its success and its strong position
in the market as compare to its competitors is its strategies and quality of products. Other factor
which has made it able to take competitive advantages and improving image in the eyes of
people is its sustainable activities and commitment to reduce wastes.
Competitive position of Starbucks
There is a huge competition in the coffee industry. Major competitors of Starbucks are
McDonalds, Caribou coffee, Dunkin’s Donuts etc. Starbucks has covered 50% of local market
and then others big brands started targeting the Starbucks.
Starbucks McDonalds Dunkin’s Donuts
Stores Company is having
21000 stores in the
country.
It has more than
36000 stores.
Dunkin has only
11000 stores which
is lower than its
other competitors.
Gross profit
margin (GPM%)
In the year 2014 its
GPM was 58.84%
McDonalds has
44.29% GPM in the
year 2014.
It has 32.38%