Business Feasibility Analysis of Starbucks Coffee in New Market

This report presents a business feasibility analysis of Starbucks, examining its potential for expansion. The analysis begins with an introduction to Starbucks' business, market presence, and operational segments. It then details the data collection methods used, including questionnaires and sampling techniques, along with primary and secondary sources. The research methodology, including the survey method, sampling frame, and questionnaire design, is clearly outlined. Data summarization and descriptive analysis are performed to assess consumer preferences regarding taste, variety, quality, price, service, and cleanliness. The report interprets the data, providing insights for decision-making, and concludes with recommendations for Starbucks to improve its offerings, particularly focusing on price and quality, to succeed in a new market. The analysis emphasizes the importance of understanding consumer attitudes and adapting strategies for market entry.

Business feasibility Analysis

Table of Contents
Introduction......................................................................................................................................3
Data collection.................................................................................................................................4
Research Methodology....................................................................................................................7
Data Summarization........................................................................................................................8
Data Analysis.................................................................................................................................12
Conclusion and Recommendation.................................................................................................18
Appendices....................................................................................................................................22

Introduction
Starbucks has nearly 32,660 coffee shops. The shops offer espresso drinks and food items, just
like boiled beans, side dishes of espresso and tea. Starbucks operates more than 16,635 of its
own stores, which are mainly located in the United States; while licensees and licensees operate
approximately 16,025 units worldwide (remember several areas for retail plazas and airports).
Starbucks also markets its espresso through supermarkets, food management outlets and allows
its image for other foods and beverages. The United States accounts for the majority of
Starbucks' revenue. The chain operates across three documentary business segments, the largest
of which is American, which includes operations in the United States, Canada, and Latin
America, and generating approximately 70% of revenue. pulled by International (over 20% of
the group's turnover), spread to China, Japan, Asia Pacific, Europe, the Middle East and Africa.
Activities in these areas include the delivery of foods such as espresso, single-serve food and
produce through organized labor and licensed stores.

Data collection
Gantt Chart
Primary Sources
1. Questionnaire method:
Questionnaire is a research tool, in which a series of surveys, along with a selection of responses,
are printed or grouped on a structure used to obtain clear data from respondents. As a rule,
surveys will be delivered to interested individuals by post or post, inviting them to manage and
return searches. Witnesses are responsible for seeing and understanding the questions and
answering in the space provided in the actual survey. The investigation is ready because it
interprets the data necessary for carrying out the investigation, to which the witnesses can and do
respond.
 Format of questions
Restricted questions, also known as closed finishes, require the respondent to make decisions:
yes or no, examine the problems that have fallen, or choose from a series of decision responses.
It is not difficult to formulate and introduce reinforced questions.
Unrestricted questions are open and allow respondents to provide vital information and insights
into the current problem. Unlimited surveys are difficult to categorize and collect, but they allow
respondents to uncover the depth of their feelings. Assuming the goal is to gather information
from all respondents, it is best to limit yourself to limited, simple and measured research.
Assuming there is levels of emotion or depth of thought to study scale nursing care to gauge
these feelings.

2. Sample frame
Sampling frame is the actual configuration of the units from which an example was drawn:
because of a non-regular basic example, all units of the scheme have equal access test to be
attracted and occur in the example. At best, the test margin should be agreed with the number of
residents affected.
When speaking about a sample frame and it is representative of the general population under
consideration, it will also be considered about who is excluded from the exemplar scheme.
People who haven't done a test study are often just as important as considering the target
audience, because without them, key things could be slowed down or missed. There are two
types of audit errors, also known as non-sampling error:
Inclusion Error: When a study profile does not adequately cover the population required for
testing, an inclusion error occurs.
Unresolved error: This error reflects people who were reached for a general view but were
unable or unwilling to attend.
Interviewer Error: This error occurs when an interrogator records an error in an answer for a test
member.
Processing Error: This error refers to the specialized preparation of test focus information and the
errors that occur when information is collected using a level of innovation or during the
information segment just like coding, clearing and modifying information.
Response Error: This error reflects people taking part in an experiment who, intentionally or
unintentionally, misrepresenting research findings.
3. Sampling methods
 Probabilistic sampling methods
1. Simple random sampling
For this situation everyone is completely chosen by some coincidence and everyone from the
population has the same ability, or appearance, to be chosen. One way to get an irregular

example is to give a number to each person in a population, followed by using a table of irregular
numbers to choose which people are to be included.
2. Systematic sampling
People will be selected in standard pieces from a test point of view. The stroke is chosen to
ensure that there is a sufficient sample size. Procedural analysis is always more useful than non-
routine direct monitoring and is not difficult to control. However, it can generally encourage
bias, for example if the application for individuals within the study framework contains basic
examples, as long as the testing strategy agrees with the timeliness of the basic example.
3. Stratified sampling
In this way the population is initially divided into subgroups (or series) which all offer a
comparable brand. It is used when we might expect interest rates to move between different
subgroups.
4. Clustered sampling
In a baseline test, population subgroups are used as a unit of study, as opposed to humans. The
population is divided into subgroups, called subgroups, which are randomly selected to be
remembered for testing.
 Non-Probability Sampling Methods
1. Convenience sampling
The study of comfort is perhaps the most diligent study method, because members are selected
on the basis of accessibility and ability to participate.
2. Quota sampling
This monitoring strategy is routinely used by economists. Applicants are given a set of
predefined arguments to try and list.
Secondary Sources
Secondary research is a method of study that involves the use of existing information. Existing
information is summarized and aligned to extend the practicality of a study. Distribution testing

is optional to include research materials in comparison to research and archived reports. These
records can be accessed from open libraries, sites, information obtained from properly completed
surveys and so on. Some administrative and non-governmental offices also store information,
which can be used for research purposes and retrieved from them.
A large test option is more expert than a research requirement, as it uses existing information,
less research is required where information is collected directly from its associations, groups or
organizations they can use the alien gathering information for their own good.
The following are commonly used test methods and optional test templates:
1. Data available on the internet: One of the most popular ways to gather supporting information
is through the use of the web. The information is readily available on the web and can be
downloaded in a snare.
2. Government and Non-Government Offices: Assistance test data can be collected from some
government and non-government offices. For example, the U.S. Government Press Office, the
United States Census Bureau, and Small Business Development Centers have important and
meaningful information that can be used by organizations or associations.
3. Public Libraries: Public libraries are another suitable source of information for support
research. Public libraries are duplicating important previously conducted tests. They want a
meaningful data storage facility and reports from which information can be extracted.
Research Methodology
Survey method
The survey method used for this business feasibility research includes online survey through
sharing the link of Google forms to selected participants on their email ids.
Research sampling frame
The sampling frame includes collection of data from Hulumalé population. The size of the
population contains 25 participants who are regularly consumes coffee and also have knowledge
about different flavors of coffee. All the participants considered for questionnaire are both male
and females and having aged above 18 years of age.

Questionnaire
The questionnaire consists of 7 multiple choice questions which are focused on price, quality,
design, taste and other variables that are related with brand consumption. These multiple
questions also include 3 questions based on grid, out of which two are based on multiple grids
and one is focused only on single grid.
Data Summarization
Data representation

Data Analysis
Descriptive analysis
What attributes are important to you when consuming coffee at coffee shop?
1. Taste:
Mean -0.2
Standard Error
0.32659
9

Median 0
Mode -1
Standard Deviation
1.63299
3
Sample Variance
2.66666
7
Kurtosis
-
0.52711
Skewness
-
0.02496
Range 6
Minimum -3
Maximum 3
Sum -5
Count 25
2. Variety of coffee flavors
Mean 0.68
Standard Error
0.1976
5
Median 1
Mode 1
Standard Deviation
0.9882
6
Sample Variance
0.9766
7
Kurtosis
1.9845
6
Skewness -0.4072
Range 5
Minimum -2
Maximum 3
Sum 17
Count 25
3. Quality of coffee beans
Mean 0.72
Standard Error 0.19595

9
Median 1
Mode 1
Standard Deviation
0.97979
6
Sample Variance 0.96
Kurtosis
-
0.84224
Skewness
-
0.24545
Range 3
Minimum -1
Maximum 2
Sum 18
Count 25
4. Price
Mean 1.2
Standard Error 0.23094
Median 1
Mode 2
Standard Deviation
1.15470
1

Sample Variance
1.33333
3
Kurtosis
-
0.64513
Skewness -0.2471
Range 4
Minimum -1
Maximum 3
Sum 30
Count 25
5. Friendly services
Mean 0.6
Standard Error 0.23094
Median 1
Mode 1
Standard Deviation
1.15470
1
Sample Variance
1.33333
3
Kurtosis
0.33757
4
Skewness -0.8825
Range 4

Minimum -2
Maximum 2
Sum 15
Count 25
6. Speed of services
Mean 0.6
Standard Error
0.21602
5
Median 1
Mode 1
Standard Deviation
1.08012
3
Sample Variance
1.16666
7
Kurtosis
-
0.42639
Skewness 0.25877
Range 4
Minimum -1
Maximum 3
Sum 15

Count 25
7. Sales Promotion
Mean 0.28
Standard Error
0.20428
7
Median 0
Mode 1
Standard Deviation
1.02143
7
Sample Variance
1.04333
3
Kurtosis
-
1.09221
Skewness 0.14524
Range 3
Minimum -1
Maximum 2
Sum 7
Count 25
8. Cleanliness of the shop
Mean 0.08

Standard Error
0.16248
1
Median 0
Mode 0
Standard Deviation
0.81240
4
Sample Variance 0.66
Kurtosis
1.49645
9
Skewness
-
0.15326
Range 4
Minimum -2
Maximum 2
Sum 2
Count 25
Data interpretation for decision making
Based on descriptive analysis of the data, it can be stated that average people are not concerned
about the taste of the coffee. Most of the people are moderately concerned about flavor of the
coffee. Most of these people are also moderately concerned about quality of the coffee beans.
But average participants are concerned about price of the coffee. On the other hand, results show
that maximum participants are moderately concerned about café services such as; Friendly
services, Speed of services, Sales Promotion and Cleanliness of the shop.

The opinion of those participants who has taste Starbucks coffee indicates that; Starbucks
delivers tasty coffee to its customers. Also maximum participants find variety of coffee flavors
deliver by Starbucks is suitable. On the other hand, maximum participants found that quality of
coffee beans of the company is average, while these participants are not agree with price charged
by the company compare to its quality. Starbucks gives friendly services to its customers, but
speed of the service provided by the company is below average. Also the location of Starbucks
shops are at convenient locations, but company requires focusing on its cleanliness of the shop.
Based on above interpretation, company will take decision price and quality of the product while
launching its new business in Hulumalé. The overall attitude of majority of participants towards
Starbucks coffee is favorable. Hence, it is feasible for the company to launch its product in the
new market with suitable improvement in two criteria’s including price and quality.
Conclusion and Recommendation
Conclusion
The above analysis shows that Starbucks coffee is required to fulfill its some of the shortcomings
before launching its product in the Hulumalé. The company’s interest in espresso products and
snacks is largely driven by various elements including extra cash, per capita use of espresso,
mental well-being, worldwide espresso respect and socio-economic aspects. This sector is
acutely aware of the macroeconomic variables that influence the development of consumption
households. As a result of the crisis, the decline in liquidity outside the home as a result of rising
unemployment and old wages has put pressure on the company’s revenue and productivity
margins. Another key feature in reducing interest in the industry is the use of espresso per capita
in which the increase in espresso consumption is expanding the income of espresso and
bocconcini shops. The main reason for this increase in usage is the increase in discretionary cash
flow, as the economy recovers and buyers begin to set their financial plans. This driver is having
a positive impact on market revenue. Per capita espresso consumption is set to increase in 2014.
One of the main ways Starbucks has followed since its inception is to separate items that offer
differences, for example, a mix of private items, ranges, espresso food and drink, and unequal

customer support practice that meant building a reputable brand that is costly for competitors to
report. Similarly, Starbucks has pursued a visionary process of critical engagement and deep
ownership. Starbucks did not follow a diversification model and an action group organized stores
and activities in global business sectors. Starbucks made some key items like Teavana (tea
items), Bay Breads (main bread products), Evolution Fresh (new items for pressing) and so on to
use the item expansion system. Starbucks' buying strategy, as can be seen in their safety story in
the Appendix, has been a smooth, productive and market-raising. Another key strategy for
Starbuck’s development is its global approach to entering key areas created and developed to
expand geologically, and has been highly effective with the industry spanning over 60 countries.
These employees have given Starbucks a huge advantage over the competitors.
Since espresso beans are the essential contributor to the industry's debt chain, the volatile total
costs of espresso beans determine market costs and profit margins. The cost of espresso around
the world has increased significantly recently due to the development of interest in several
countries and the resulting lack of investment. In the five years to 2018, espresso wife costs are
projected to decrease, which could lead to lower market costs and higher profitability. Wellness
minds also play a key role in determining interest in the industry. There is a trend towards a
smart diet and diet among consumers in 2014 and this could pose a threat to the industry as they
become more curious about current topics, marked with emphasis and strength. There has been a
proactive shift among industry members to make their menus a more natural and healthy mix.
Starbucks' core skill is the ability to use their basic theme separation techniques while offering a
unique mix of excellent foods and snacks. The value of the Starbuck image is based on selling
the best quality espresso and related items and providing a unique "Starbucks Experience" for all
customers, which can be obtained from customer service they are the way of life of the networks
in which they operate, determining a significant level of user involvement with the clique of
followers. Another human resource center's capability is a board-based approach to build strong
internal and external partnerships with suppliers, driving the effective organization of its natural
enterprise business approach to industry segments around the world, also mixing through strong
grip and catastrophes that keep pace with their essential goal referred to as the most visible and
seen brands on the planet.

Starbucks has a large topographic presence worldwide and maintains a 36.7% slice of the pan in
the United States and has operations in over 60 countries. Starbucks is also the most visible
brand in the bar segment and ranks at 91 among the top global brands in 2013.8 Starbucks makes
full use of its rich image value by selling products, allowing image branding to come out. Strong
market positioning and brand recognition enable the organization to gain a definite advantage in
further penetrating industry segments worldwide and further helping to record higher
development in domestic segments and physical. Over the long term, they have achieved large
economies of scale with major investment channels and supplier connections.
Starbucks has shopping in the most important and important area in the world. They serve
advanced, high-traffic, high-visibility areas close to a range of environments, including town and
rural centers, industrial areas, university grounds, and in regional and regional areas. out of state
worldwide.10 provided it has great potential and advantage to have the opportunity to integrate
the key areas of activity and take advantage of the persuasive feature of consumers. Their shops
are attractive on the outside and have a "cool" feature with the intention of showing an
interesting person the place they serve and without harming the ecosystem. They offer free
wireless internet, amazing music, amazing help, warm air and a local hanging feel, which frames
a larger piece of the "Starbucks Experience". The company's core goal is to make their stores
"third place" different from home and work.
While Starbucks separates its items into a complete quality match with the whole "Starbucks
Experience", between lazy money, customers will have variable costs like competitive items with
higher, lower cost, and swear to pay a base price. Likewise, these rising costs can represent a soft
space for non-industrial nations to exist. With strong development and high immersion due to
market congestion, it promotes self cannibalization and reduces the long and slow development
of Starbucks. This is especially true in the United States, where Starbucks operates 8078 stores.
The growing immersion and self-cannibalization of the US market make its global approach far
more important. Starbucks has made great strides in a number of countries; with India
understanding so late along with the entry of joint efforts.18 Starbucks has significant
development potential in taking further initiatives in emerging and emerging markets. They can
use size, vision, financial capacity and efficiency to create a new slice of the pie. Starbucks has
used portable applications and has a corporate partnership with Square, a multifunctional

allowance application integrated with its Starbucks application. This facilitates customer
interaction by changing customer resilience through paid programs. Starbucks has actually set
the industry bar with this advancement, and about 10% of its U.S. trade was done using
multitasking applications. This is an evolving field and would bring more companies to their
stores as innovation progresses. : Starbucks provides an extraordinary brand image and can use it
to broaden the lines of its business and also include promotional items while keeping the risk of
brand weakening in check.
Recommendations
Starbucks has the biggest development on its international side. The developing industrial sectors
in Brazil, India, China, South Africa and Mexico, with a developing working class population,
continue to offer tremendous freedom for new sources to open up added and served more
customers. Starbucks has certainly made great progress in the Chinese market, but significant
development is still expected in these industry segments. Starbucks should address the
developing business segments by winning locally Starbucks should be available for the customer
to fill those business segments and the its management teams work within their overall structure
to customize the design of the stores, showcasing a mix of neighborhood and value factors
focusing on the needs, lifestyles and tastes of each individual market / area.
Under the worldwide Starbucks approach, it had to move the core capabilities and capabilities
from one country to another and then gradually accumulate the welfare drivers in some countries
as it went going forward with global expansion in a natural way. Starbucks has tremendous
development opportunities by mixing fresh tea and juice items. They should develop these items
in a line that is similar to their quick key items.
Starbucks is also recommended to focus on improving its product quality and price to perform
well in the new market.

Appendices
Questionnaire