Comprehensive Business Report: Starbucks' Market Position Analysis

This business report provides a comprehensive analysis of Starbucks, examining both its internal and external environments. The report begins with an introduction and then delves into the external environment using PESTLE and Porter's Five Forces analyses, assessing political, economic, social, technological, legal, and environmental factors, as well as the competitive dynamics within the coffee industry. The internal environment is then scrutinized through VRIO and value chain analyses, evaluating Starbucks' resources and capabilities. The report also includes a stakeholder analysis and concludes with recommendations for improving Starbucks' performance. The report provides insights into the company's strategies, competitive advantages, and challenges, making it a valuable resource for students studying business and market analysis.

STARBUCKS BUSINESS
REPORT

Table of Contents
INTRODUCTION...........................................................................................................................3
External environment analysis....................................................................................................4
Internal environment analysis.....................................................................................................7
Recommendation.......................................................................................................................10
Starbucks share holders report..................................................................................................10
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................12

INTRODUCTION
Business report is contains the detailed analysis of the internal and external factors which
would have effect on the company performance in market. The report is based on the case study
and the case study is including the company of Starbucks which includes the competition which
was faced by the company in the market. The competitors of the company in the market in the
affect segments are the MacDonald and the dun kin donuts as well. These both the companies are
facing the strong competition in market. Company is also using the employees and pampering
them in the effective way. Employees would use the employee to fight the competition in
market, and they would face the strong competition in market to achieve the growth in market.
Employees are given the benefits and also they are motivated for working effectively. Company
is offering the offer to the employees which are also part-time employee sand full time
employees (Racz, and et.al., 2018). The package given to the employees would make the dental
medical disability insurance. Proper career counselling sessions are arranged by company
Because majority of the employees which are working in company are students. Company has
also expanded the business sin the global countries which would include the countries form the
Asia, America and Africa. Company is gaining the growth in market and earning huge profits.
The report includes the detailed analysis of the competitive position of company in
market and these would have the effect on the company image. External environment of the
company is analyses by the way of the porters five force model and the pestle analysis. Pestle
analysis would include the political factors, legal factors, technological factors, economic factors
and sociological factors. These all are affecting the company sales and these have impact in the
company image in market. The report would also contain the detailed analysis of the internal
environment and the which would include the value chain analysis and the vrio analysis. These
are analysis the internal environment of company and these would have effect the company
image as well (Nandonde 2019). The report would also contain the stakeholders report and it
would include the internal and external report so it would also include the power of the
stakeholder is also discussed in the report. Report is providing the knowledge to the students
regarding the Starbucks strategies and what could be used by company CEO to improve the
performance.

External environment analysis
Company is using the pestle analysis for analyzing the external environment in the
effective way. As per the recent analysis customers are not stopping their coffee consumption,
but they are shifting towards the other coffee outlets which are providing the coffee at low price.
Political factors
Political factors which are having the impact on the company matters. Raw material is
ordered by company form the for the wet which is gaining the attention of the politicians and
these are affecting company. Company had to follow strict rules and regulation of the various
other countries which are working in the effective way. Activism has increased and political
awareness is also increased as well. Taxation policy is amended by politician by the time and
these are affecting the company at the large scale. Employment laws are also affecting the
company and the other competitors in market (Fozer, and et.al., 2017).
Economical factors
Local currency is fluctuating from time to time and the economy is also fluctuating
continuously. These would have impact on company affairs and economy is changing in
different countries as well. Starbucks is dealing in local market but the company is also dealing
in the global market so the companies of other countries is affecting the company. Economic
recession is affecting the external environment of company but the customers are shifting
towards other cheaper alternatives. Company has to deal with the rising of the labor cost and the
laws which have amended by government for the employees which are working in company.
Socio cultural factors
Socio cultural factors are affecting the company, company can try to offer the cheaper
quality product and compromise with the quality of the products. But it would affect the
goodwill of Starbucks and these would not be beneficial for company. Consumer preferences are
changing and these would affect company because consumers are switching towards the cheaper
quality of the coffee. Standard of living the is increasing rapidly and these would affect the
lifestyle of company. The education level is also affecting the company because people are not
aware about and educated as well related to the company and the products (Knott 2015).
Technological factors
Technology is increasing and people are using the technology in other day to day life.
Company is providing the WiFi connections at all the outlets so customers would be able to use

the internet and sit at the cafe. Starbucks has also introduced the option of the online payment
which was appraised by customers. Innovative technology is attracting customers and these
would beneficial for company, so they would sue the new technology and make something
innovative which would attract customers at the large scale. Starbucks is increasing the
popularity by the help of the partnership with the Apple and these have landed the company in
huge market growth.
Legal factors
Strict rules and regulations is affecting company because company is dealing in various
countries and company has to deal with the other laws and regulations in different country. Strict
custom and trade regulations are affecting company at the large scale. License is need ed by
company for working in that particular country. Customers are consuming caffeine and some
would not suit the caffeine and it could be injurious to their health. So company must have
license regarding working in industry(Vargas-Hernández and Garcia, 2019).
Environmental factors
Environmental is polluted and it is affected by the working of the Companies in the
market. So companies are investing huge amount in protecting the environment. Companies have
to follow the rules and regulations which are levied by government on company. Environment
disasters have been occurred in countries which are providing the coffee beans. Global warming
is also the factors which is affecting the company at the large scale. Due to global warming
climate is not stable and climate is changing at any time. These are affecting the coffee beans
and also the quality of the product and services which is delivered by the company is
compromised.
Company is also using the porters five analysis for analysis the external environment.
Porters five forces is analysing the position of the company in market and it is also analysis the
industry. Strengths and weakness would be identified and company would use the at least
strategies for surviving in market (Hernández, and Garcia 2018).
Threat of new entrants
There are various competitors in market but the new companies are not going to enter the
market and industry because these type of industry requires huge amount of investment and food
outlets in every part of the country. New entrants would not earn the loyalty of customers and
would not fight the brand image of company. There are various laws and regulations for new

entries in market and these would affect the new entries. So the new entrants would think before
entering the industry. There are much coffee shop in country which would running from many
times and also provide the products at the low cost so these type of the new entrants would affect
business but at the low cost.
Competitive rivalry
Starbucks is the quick service restaurant and company would face problems while
fighting the competitor in market. Competitors like the MacDonald and caribou coffee which are
the strong competitors for the company in market. Caribou coffee has also started providing the
products which are environment friendly. Rivalry among competitor sis increasing by the way of
using the new technologies and providing the product at low cost. Competitors are strong
because they are able to use the new technologies and innovate their products at the large scale.
These would affect the company image, and they would fight the competition in market
(Hernández, and Garcia 2018).
Threat of substitute
There are various substitute products in company which would be affecting the company
image. Like the caribou coffee is delving the some products but it is delivering product at low
cost. These all would affect company and many people are making the tea and coffee at home,
and they would only prefer the coffee at the home. So these reason is also the reason of the
increase in substitute products. In market there are various substitute products like the juices and
drinks which are preferred by Customer in the large scale. Substitute products are the provided
by the customers at the low cost and these would affect the company because company in selling
the coffee at the fixed price.
Bargaining power of suppliers
The raw material which is sued by suppliers are provided by many of them and so these
would not affect the company. Supplier of Starbucks are spread throughout the world and these
suppliers are satisfied by company and company is satisfied by supplier raw material as well.
Coffee which is imported form arabica is premium quality coffee and it is used in preparing the
coffee at the Starbucks. Suppliers do not have the power, and so they would not have power
relating to the bargaining in company (Ariyani and Daryanto 2018).
Bargaining power of suppliers

Starbucks is facing strong competition in market and these all would affect company at
the large scale. Customers are changing their preferences and hence company is affected by the
decision of customers. Some customers are not worried about the price of products but some are
worried, and they would not visit the cafe again. So company must try to slightly decrease the
price of products which would attract customers. Coffee is also working as addiction for
customers which are visiting the cafe regularly and by consuming coffee. So the customers are
addicted towards the coffee, and they have to visit cafe for consuming it.
Internal environment analysis
Starbucks is using the vrio analysis for analysing the internal environment of company
and to identify the factors which are affecting the company. Vrio analysis is used for analysing
the value and the rarity and imitability of the products and company (Bammann, 2019).
Valuable
Strong brand image is valuable and it is affecting the image of company in the market. It
is the useful resource and it would help company to gain the huge profits at the large scale.
Special quality and coffee and also it would include the special flavors in coffee as well.
Customers are attracted towards the coffee and so it would help company in gaining the high
profit as well. Strong environment is leading the company towards the customers, and they
would gain popularity for good environment and good services which were delivered to
customers. Supply chain would help the company to deliver the good quality of raw material and
also it delivers the good quality products as well. Global presence of company in global market
is strong and it is building the strong competitive environment for other companies in market.
Rare
Special flavour and quality of coffee is the must for customers which are working in
company. The creation of flavour would only affect the company and these would not affect
company at the large scale. Starbucks is ordering the raw material form the other countries, so
these would give the special feature sot the coffee which is being provided by the customers by
company. Environment of the cafe would be achieved by the way of other stores as well. But the
company would make the same special features and decoration which would attract customers in
company. Supply chain is difficult for the other companies to achieve the target of the Starbucks.
So company can invest in supply chain and make the chain strong and effective which would
fight the competition in market in the effective way (Mudambi. and Puck, 2016).

Imitable
Strong brand image would be difficult for the company because company is running in
market in the effective way. Other companies in market would be achieving the strong brand
image but for that company has to stand strong in competition and work in the effective way.
Special flavors and quality of coffee would be imitated because they would achieve the targets
by the way of these flavors. Prices and procedures would be used by company but the company
need to work in the effective way and other companies could not imitate the products by the way
of the prices and procedures. Customer service and store environment would be affecting the
company at the large cost. Supply chain and global presence is affecting the company and these
would not be imitated by any other company.
Organized
Strong brand image is organized and it would be achieved by the way of the special
features of the products and the quality of the products. Customer service would not affect the
company and these are environment would not be affecting the company at the large scale.
Marketing of the Starbucks need to be improved and these would lend the company in earning
the high profits. Supply chain would be affecting the coffee ethically and exceptional quality of
the beans would be affecting the company at the large scale. Global presence of the Starbucks is
all over the market and these would affect the company at the large scale. Global presence of
company would generate high profits and high revenue for the company. Starbucks is also
providing the agreeable and working environment in company cafes and business meeting would
also be handled in the cafe (Jaligot, and et.al., 2016.).
Value chain analysis
Value chain analysis is the analysis and it consists of the combination of the systems of
the company objectives and the organization would be managing the company at the end earning
huge profits. Value chain analysis would include the five primary activities and these would
support the primary activities and it would also include the logistics and marketing of the sale of
the products in market. The goal of the analysis is to exceed the value and the exceeds the cost of
the conducting the activity and generating the higher profits.
Inbound logistics of the Starbucks would include the supply chain of the company and it
would create the single and global logistics systems as well. The coffee beans are bought by the
company form the Asia, Africa and America. Company is also purchasing the green coffee beans

and coffee roasted coffee beans form the coffee producing regions. There are up to the six
regional distributors in the company in the different regions and these are beneficial for the
company to achieve the growth as well. Starbucks is exploring themselves and growing the own
coffee beans and it would benefit the company by the way of increasing the effectiveness of the
coffee beans and developing the new product by the company (White, and et.al., 2018).
Starbucks operations
Starbucks is operating in the 75 countries and it would enable to manage the work in the
effective way. Company is operating the stores, and they would be preparing the food as per the
taste of consumers and customers are also going their feedback and provided in cafes, so they
would improvise the product. Various outlets are made by company and many of them are
generating high profits and these would make the company to generating more revenue. These
marketed segments are operating on the basis of the customers because customers are spending
the quality time with each other in the cafe.
Starbucks outbound logistics
consumers are purchasing the product of the Starbucks form these stores and they would
buy the products at the initial stage only. Starbucks is delivering wide range of products which
would attract the customers in the effective ways. Products would include the packaged coffee
and baked products and many more. Coffee sachets can be purchased by customer from the super
market chains of Walmart and many more. There is absence of the intermediary, and they would
provide the products to customers without the help of the wholesalers and retailers. Company is
running the business in the market by the way of the licensed stores and wholesaler would not be
able to see the product of the Starbucks in the market (Cuppen 2016).
Starbucks marketing and sales
Starbucks was investing in marketing but after some time company was not investing in
marketing and due to these it would the company to decrease in the sales of products. High level
products and quality level products would be achieved by company in the effective way.
Starbucks is increasing the marketing budget and company has started investing in the promotion
of products and media adverting of the events. Company has also started the online payment
systems and mobile ordering application for providing the convenience to customers.
Starbucks service

Starbucks would be increasing the competitive advantage by the way of the primary
activities of satisfying the customers. Employees are trained, and they are behaving polite with
the regular customers and other customers which are visiting the cafe. Regular customers are
getting the coffee by their names and regular coffee would be provided to them without wasting
their time. Nature of customers and increasing the lifestyle of customers is affecting the sales and
the service which are given by employee in company. Starbucks is spending more time in
measuring the problems and trying to solve the issues and so the company is growing at the slow
cost.
Recommendation
Diversifying its business operations and developing product as per customer preferences
on the basis of target market will improve the revenue growth opportunities which in turn helps
in increasing profitability. Introducing new products in the market with different style,
presentation, affordable price and flavours which will help in attracting new customers, increase
profitability and expand market. Starbucks can employ value based pricing to maximize profits
by analysing customers and market to set a targeted price which consumers are wiling to pay. It
will help in tackling with the price sensitivity issue. Along with that it should try to increase its
profit margin by reducing its cost of production. Sharing its business insights, new ventures,
upcoming events, ask customers to share ideas and opinions on different fronts about
organizations working.
Contributing and participating in the CSR activities, coming in public for a cause, will
highlight its brand name in positive way and increases brand awareness. Entering into a
partnership with other big firms which will help in developing its market presence and market
share and will also help in sharing expense and managing cost. Starbucks should implement a
customer loyalty program which include gifts, vouchers, cash backs, gift cards, discounts etc.
This will grab new customers, creates brand image, enhances customer loyalty. Advertising the
customer loyalty program on social media platforms would be an added advantage and extending
the online customer service will increase digital customers (Eskerod. and Jepsen 2016).
Company would achieve the goals by the way of the concentration on the marketing
activities and improving the business performance in market. Company could use the latest
technologies for attracting the customers and these would be beneficial for company. Company
can use the social media and use the latest technology equipments and make the coffee and other

products in the new way which would also include the new features as well. Company need to
concentrate on the stake holder of company like the customers and employees. Company is
working for the employees but then also employees are not satisfied so company must try to
motivate employees and look after the achieving the long term goals. These would not only
attract customers towards company but also company would improve performance.
Starbucks share holders report
In the business organization stakeholder are one which are affected by the actions and
objective of organization. Stakeholders are from the creditors, employees and customers. These
all are affected by the business activities and the polices of the business which are used by them.
These all are one which are affected by the company work and performance in market.
Employees are working in company, and they are affected by the company work in the effective
way. Investors are one which are affected by the company performance because they have
invested their money in company (Paletto Hamunen. and De Meo 2015).
Customers are affected because customers are one which are not involved in company
matter, but they are buying the products of company. Majority of company affairs are not related
ot customers, but they are affected by the company actions. Customer do not have power related
to participate in the company decisions, and they would not change the company decisions but
customers would show their reviews for the decisions by way of buying products or not buying
products. Majority of customer are which would afford to buy the Starbucks coffee because
some people are not able to buy those products. Company has set the target customers and have
used various strategies for attracting the targeted customers. Company has targeted customers
from age of 25 to 40 which includes men and women.
Company is also trying to target the young adults which are from the age of 18 to 24.
Starbucks is creating the environment in cafes in which students would hang out and study. Kids
and teens are also attracted by company and it is forming the large part of targeted customers.
Company is also planning to attract customers by the way of complimentary products and the
company has also increased business by the way of online food ordering. These products are sold
in market by the way of the food service outlets of the Starbucks and company is also making
products eco-friendly which would attract customers because company could not serve caffeine
to the kids. So company has come up with the baked products and many more. Company is using
new strategies for attracting the customers like the company would use the new technology for

attracting customers. Like the company is using the social media marketing and social
networking sites, so the customers would buy the products online (Wang Liu and Mingers 2015).
Mendelow matrix is used by company for analyzing the need of the customer at the initial
stage. Customers do not have power, but they have power in their hands at some extent. Like the
customers would boycott the products and not buy products. Company can use the effective
communications' strategy for communicating with the customers. All stakeholder must have time
to time communications which is beneficial for company. Company can come up with the proper
grievance portal for registering the customers negative reviews and feedback. Complaints of
customers would be registered and company would take the actions on that complaints in the
effective way.
CONCLUSION
From the above report it would be concluded that the CEO of the Starbucks would use
the latest strategies for improving the company performance in the market. These would also
include the detailed description of the internal and external environment of the company. Factor
which are having the impact on the company image is discussed in the report above and that
would include the pestle analysis and the vrio analysis as well. The company can overcome the
problems by using the marketing techniques and working on the employees in the effective way.
Employee snare running the company and so employees need to be satisfied in the effective way
which would improve the performance of company in the market. Stake holder analysis is also
included in the report and the stake holder of the company are the employees and customers.
Investors are one which are investing in company and so company would look after the investor
and try to satisfy them. Otherwise, they would take their investment and company would be
lending in the big trouble. So the company would use the new technology for attracting the
customers towards the company.

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