SWOT Analysis of Starbucks

This document provides a SWOT analysis of Starbucks, focusing on its strengths, weaknesses, opportunities, and threats. It discusses the company's reputation, global supply chain, growth strategy, and profitability. It also highlights its weaknesses such as high prices and lack of unique products. The document explores the opportunities for partnerships and diversification, as well as the threats of imitation and competition from low-price coffee makers.

SWOT Analysis 0
SWOT Analysis
Starbucks
Student’s Name
5/30/2019

SWOT Analysis 1
Introduction
SWOT analysis is considered as the renowned tool for analyzing the strategic position
of the business and its environment. It helps the company in developing the strategies that
effectively align the resources with the external environment. Starbucks is considered as the
world’s largest coffee chain that efficiently uses the SWOT matrix to develop the best
strategy for the future (Bull et al, 2016).
Strengths
 The company enjoys a strong
reputation in the market.
 It has an extensive global supply chain.
 The company forms subsidiaries to
diversify its brand.
 The company has a well-planned
growth strategy and effectively
manages its employees.
 It charges premium prices and enjoys
profitability.
Weakness
 Charging of high price eliminates
customers.
 It does not provide overly unique
products.
 The company has its generalized
standards.
 Easy imitability of products.
Opportunity
 The company has the opportunity to
have partnerships with other firms.
 It has the opportunity to expand the
business in developing markets.
 The company has the opportunity of
diversification of its business.
Threats
 Low price coffeemakers attract
customers.
 Development of independent
coffeehouse movements.
 Imitation of the products.

SWOT Analysis 2
From the above table, it is analyzed that Starbucks enjoys a strong reputation and is
recognized as the most popular brand. The company charges premium prices for its products
and has global suppliers to provide the best quality products. The company operates a well-
planned growth strategy and focuses on developing partnerships and subsidiaries to expand
its business operations. It is able to deliver unique products and experience to the customer
and achieve higher profitability (Phadermrod, Crowder & Wills, 2019).
The company has its generalized standards that do not allow flexibility in its operation
and the company is not able to deliver overly unique products. It does not allow making
cultural alignment with the local market. Charging of the high price does not allow targeting
the low-income groups and in turn, reduces the demand for the products. The small coffee
shops are not able to imitate the products but make the similar products as Starbucks and also
try to imitate the services delivered and the ambiance of the café which shifts the demand of
the customers and affects the profitability of the business (Mason, Cole & Goza, 2017).
It is analyzed that the changing shift in lifestyle and preferences increases the demand
for coffee lovers and provides the opportunity to establish its store in developing countries.
The company must focus on adopting a diversification strategy for the long term stability of
the business and must make the strategic alliance or partnership to increase its market share.
Partnerships with the other firms will help to increase the revenue of the company (Lemus,
von Feigenblatt, Orta, & Rivero, 2015).
In contrast to the opportunities the company also faces the threat of imitation of its
product and services by other coffeemaker brands. The entry of low price coffee makers is
the biggest threat for the company because it switches its loyal customers and the support
from the government to develop the independent coffeehouse makers reduces the demand of
multinational coffee chains (Mason, Cole & Goza, 2017).

SWOT Analysis 3
References
Bull, J.W., Jobstvogt, N., Böhnke-Henrichs, A., Mascarenhas, A., Sitas, N., Baulcomb, C.,
Lambini, C.K., Rawlins, M., Baral, H., Zähringer, J. & Carter-Silk, E., (2016).
Strengths, Weaknesses, Opportunities and Threats: A SWOT analysis of the
ecosystem services framework. Ecosystem services, 17, pp.99-111
Lemus, E., von Feigenblatt, O. F., Orta, M., & Rivero, O. (2015). Starbucks Corporation:
Leading Innovation in the 21st Century. Journal of Alternative Perspectives in the
Social Sciences, 7(1), 23-38.
Mason, A., Cole, T., & Goza, N. (2017). Starbucks: a case study of effective management in
the coffee industry. Journal of International Management Studies, 17(1).
Phadermrod, B., Crowder, R.M. & Wills, G.B., (2019). Importance-performance analysis
based SWOT analysis. International Journal of Information Management, 44, pp.194-
203.