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Starbucks Coffee Company

Autor:   •  August 22, 2017  •  3,746 Words (15 Pages)  •  490 Views

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Also, Starbucks belligerent growth can be risky, because it can lead to cannibalization. Starbucks is well known for its product development and creativity, but they continue to lack focus and continue to be vulnerable to the possibility of modernization. Lastly, another weakness is the high calories and fat content in their products because the world is more cautious about their health.


Next we have to look at the different opportunities that Starbucks has for the company. Starbucks has embraced the outlook that opportunity is not only now here but all over. They have several opportunities of expanding the company. One opportunity they have is to broaden their supplier network. They also have the opportunity it has is international expansion. There is room for growth in many countries in this world.

Another opportunity is their expansion of new products such as energy drinks. The company also has opportunities in technological advancements. These opportunities allow Starbucks to take advantage of the convenience of distributing products to more consumers through the internet. They also have opportunities with co-branding with companies such as Barnes and Noble and Target.


Lastly, we will discuss the threats of Starbuck Coffee Company. Although Starbucks has been successful through improvement and growth, however there are external factors that have created a reason to worry about the company’s potential threats. Further, fast-food enterprises increasingly join the convenience cause and offer coffee as an added service to satisfy coffee craving customers (Petrecca, 2005). Although, it may not seem to be a threat to Starbucks, McDonald’s, has in recent years become more of a competition. With their various coffee selections McDonald’s offers similar coffee drinks at a reasonable price.

Another competitor is Dunkin Donuts. They also offer coffee and various other types of drinks at an affordable price. This may affect Starbucks, but loyal customers will continue to purchase Starbucks because of its quality and not its overrated prices. One major threat was the closing of 600 Starbucks stores. These stores were probably closed because they where place in areas where individuals could not afford their high priced products, which is Starbucks major threat. Another threat is the recession we are in because if we the customers cannot afford a cup of Starbucks coffee, then they do not make a profit.

Economic Assessment

Economic assessment is an assessment which takes account of a wide range of costs and benefits, generally those that can be valued in money terms. (Isle of Wight Shoreline Management Plans) In 2005’s fiscal year, Starbucks documented $6.4 billion in revenue, which is about a 200% increase from 2000’s $2.1 billion. It is because of this that there was an after-tax profit of $494.5 billion in 2005. If we compare it to 2000’s fiscal year there was an increase of over 420% leaving the company with an after-tax profit of $94.6 million.

In recent years, the global economy has been going through a downturn which has affected many companies and the way they are run. Many countries have suffered because of this downturn such the United State. This has affected consumer buying power implying that companies have had a decrease in profits over recent years. The economic downturn has affected various companies and at times it has forced some of them to close down. Starbucks has been affected by this downturn because we conduct business in a few of the countries that have been affected by this downturn.

We conduct business in Greece and Spain, which are two of the countries that have been affected besides the US. For many years, the generated profits from our locations in these markets can be argued to be unappealing because they have altered from being the cash cows to being questionable due to the economic situations. These types of situations pose a major challenge to our company because they require that the company make vital decisions that can have an effect on the company in the long run. For instance, some Starbucks locations might have to be closed down due to the lack of monetary revenue. Since these locations are experiencing an economical meltdown management would naturally have to close them down or adapt an assortment of strategies to make certain that the business manages to make a profit in this type of market.

Market Assessment plan

Marketing is the key in any business, and mainly the rising specialized coffee industry. When creating a market assessment plan we need to look into not only our market history, but also our competitors. McDonald’s McCafe markets its low price strategy (Burritt, 2007). Dunkin Donuts on the other hand, markets that it simply has better coffee and more to choose from on its menu. (Dicarlo, 2004) I believe that the company does not assertively promote the company and/or its products. Instead, sales are driven through the company’s image and reputation.

Nonetheless, the outcome of our hard work, customer experience, ethical decision-making and employee training is known as “one of the most valuable global brands” (Theodore, 2002, p. 62). Our success has been mainly through word-of-mouth and very little on advertizing. We should focus on promoting Starbucks more than usual. I also believe that we need to review how buyers act by placing observers at specific strategic location such as locations where consumers can purchase food and beverages. This helps us observe what they like to purchase.

Once we have acquired this information we can utilize it to create new products for the company. For instance, we offer certain types of sandwiches and this study would help us create new types of sandwiches. We can also conduct a survey on what type of music relaxes our consumers. Some people like classical, so we can utilize this information within our stores and sell the music we use. I believe that if they enjoy the music they hear while enjoying their cup of coffee, they are likely to look for the tune (song), so why not think ahead and offer them to consumers.

I also think we should reevaluate any advertisements we have and create new ones. Our competitors lure their customers in with commercials with catchy jingles and we should consider looking for new ways to bring customers to Starbucks locations worldwide. Yes, I am aware that cost money, but to make money we must spend money. We have to show consumers a visual of what we are all about. We can also offer specials every month on different products.

Another way


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