Starbucks roasts, markets and retails the specialty coffee in the world. The main growth strategy for Starbucks since its inception has been Greenfield investments (Figueiredo & Guillen, 13). Greenfield investments involve the parent company starting new ventures in foreign countries. In this strategy, the investing company constructs new structures and facilities from the ground. Starbucks Corporation operates twenty-thousand, eight hundred and ninety-one coffeehouses in sixty-two countries; it is the number one brand coffeehouse chain in the world (Figueiredo & Guillen, 16). The company operates in several countries across the world. The table below summarizes some of the countries in which Starbucks operates.
Source: (Figueiredo & Guillen, 16)
Starbucks’ revenues, profits and the total number of employees as at the financial year that ended December 2012 are shown in the table below:
Source: (Figueiredo & Guillen, 18)
The company’s Chief Executive Officer admits that even with these excellent records, he has extensive plans for further expansion into other countries. The company is planning to open a mega branch, which is currently an intellectual property of the business. The company has a continuous plan of extending supplier network. Starbucks does not have the capacity to grow its own coffee. Therefore, it has to buy coffee beans from various suppliers. These suppliers are centered in Africa, America and Arabia. Starbucks uses the expansion strategy to ensure uninterrupted critical supplies in Asia and reduce overdependence of harvests from South America and Africa (Figueiredo & Guillen, 19). This strategy also saves on the costs of shipping and other associated risks of transportation.
The second strategy for Starbucks is increasing product offerings. This strategy involves a company adding new items and operation branches within the market areas (Moe, 11). The company has opportunities of expanding its coffeehouses to China and India. Starbucks could also put up additional coffeehouses that offer wine and beer, and also add new products that can meet the needs of the broader customer group. Increasing product offerings gives consumers a wider product choice, thus guaranteeing the Starbucks a larger market share than the company’s competitors (Moe, 9). The main competitors for Starbucks Corporation include McDonald’s Corporation, Nestle S.A, Costa Coffee, Dunkin’ Brands Group, Inc., Coffee Roasters and Caribou Coffee Company.
Starbucks Corporation’s positioning strategies fit several positions. The expansion strategy is possible in all regions of the world provided that the host country gives the company space for constructing structures. Given that most of the countries are working hard to attract foreign investors as one of the strategies of enhancing foreign exchange, Starbucks is guaranteed space and accommodation in the host countries. The strategy of increasing product offerings is also applicable in all markets of Starbucks. The company has an established market share. Customers can easily adopt products that they understand the producers (Moe, 13). Opening up additional coffeehouses in countries where Starbucks is currently operating is a potential opportunity for the company’s further growth and increased revenues. Starbucks’ positioning strategy fits more than one market position.
The most effective strategy to use at the moment is expanding Greenfield investments. The company has the capacity to put up new structures and facilities in foreign countries. Most of the nations of the world have tested the products of Starbucks Corporation. The company can use this as an opportunity for further investments and growth.
Works Cited
Figueiredo, Joao N, and Mauro F. Guillen. Green Products: Perspectives on Innovation and Adoption. Boca Raton: Taylor & Francis, 2012. Print.
Moe, Michael. Finding the Next Starbucks: How to Identify and Invest in the Hot Stocks of Tomorrow. New York: Portfolio, published by the Penguin Group, 2006. Print.
