Starbucks Coffee Company Case Study Example

1. Starbucks Coffee Company (Starbucks) is the World’s No. 1 specialty coffee retailer. Many years passed before Starbucks became popular. First they conquered United States Market, then entered one country after another. So, it seems to be a very successful company. But nevertheless, it has like many other companies, its strengths and weaknesses. So let start with the strengths. One the strengths is a retail expansions. People could get coffee everywhere, in any size and coffee-to-go is very popular. Product and service innovation. To attract non-coffee drinkers, they launched Frappuccino-a cold drink made from coffee. Sugar and low-fat milk and ice, that became a hit. Physical surroundings. Starbucks always have the best and crowed locations: malls, busy street corners and even grocery stores! Clean and comfortable atmosphere. It also creates a captivating atmosphere with a first-rate music like jazz and opera playing in the background. It is just a comfortable and upbeat meeting place that rekindles people’s love affair with coffee, brings romance and fresh flavor back to the brew. And it’s non-smoking policy, because the smoke adversely affects the aroma of its coffee. And the most important is that they serve just great and rich tasting coffee. Starbucks logo. It is observed everywhere throughout the store: the store logo, the cups, the sandwich wrapper and even the condiments provided. Every business has its weaknesses. So Starbucks also does. One of the Starbucks' is the prices. They are sort of high. Most of people all over the world are middle class and they can’t afford buying such an expensive coffee. Too much concentration on their coffees. According to their experience, in Japan they got almost failed, because they hadn’t learn enough about the consumers in this country. Food menu was a major part of the coffee experience and also no-smoking policy displeased many of the Japanese people. Dependency on supplier. Dependency on single supplier might run the risk of non-delivery.. Any imperfection of the suppliers and vendors could harm Starbucks reputation. Numerous Coffee Campaigns. There are too many coffee houses nowadays and it’s kind of really difficult to stay on the top of the market. Starbucks have to do their best to be and stay No.1.
2. Starbucks are very good at taking an advantage of opportunities. For example in conquering different stores and city markets: their popular Frappucino was bottled and sold through grocery stores. Starbucks’ global operations could be expanded. There are new markets where Starbucks can develop, one of them is India. Starbucks is a world-known coffee company and it is famous for its quality. And that gives it an opportunity to grow on the world market. .Threats. One of the threats could be franchising. Another threat is that Starbucks depends on the price changes of coffee and dairy products. Another coffee places performs a great threat to Starbucks. For example, McDonalds McCafe where you can find always something new, and people just love variety.
So another threat is an importation. Starbucks also only imports all their coffee beans, and if there is going to be some changes in import laws that could affect the price, which would affect the level of consumption for Starbucks coffees.
3. First of all, Starbucks is not just a coffee place. When you go there you get more than just a coffee in a cup, you get great people. So they build a personal relationship with each customer. They call it “people to people business”. The high quality coffee is one of the strategic factors. Starbucks' development process is based on a six-month opening schedule. Smart partnership is one the strategic factors, but they follow certain rules: first they asses the quality of the candidate, then look for a company brand recognition and good reputation. It must commit to quality and customer service. They look only for people who understand the value of Starbucks and promise to protect the brand and quality of coffee. And they are always open for innovations
4. The Starbucks distinctive competency is to make the café place a “third place” between home and work. They do their best to find an opportunity to own their place in every country they have branch café. With a time and because of hard work Starbucks got a very strong brand name. Starbucks is also very attentive to the ideas of the employees; its service is on the high level. Starbucks trains its employees in special way and its medical benefits is unique on the market. All these distinctive competencies help make it different from other companies like that. And it fits the Indian market on two ways. One of them is governmental. The companies only under the certain conditions could enter the Indian market: the product could be sold under a single brand, be sold under the same brand internationally and needed to be branded during manufacturing. So here Starbucks fits. And there is also a social way. It is well-known brand, fashionable place to hang out .It will bring something new and fresh to the coffee market in India and also it will give extra working places.
5.Starbucks have been accepted by the TATA on all levels, now it’s about policy of Starbucks, they have to follow their policy: keep offering the finest coffee in the world, handcrafted drinks, Starbucks’ experience of many years to the customer and to fulfill the aim of Starbucks- to become the 3-d place between home and work.
Advertising strategies used by Starbucks has also been a key success factor. . Employees approach is also the key: Starbuck’s experience that formed a culture and values which was helpful in building the relations with customer.
6. Starbucks offers variety of coffee and tea products. They also sell equipment from well-known manufacturers. They also have gifts available for purchase. They sell some stuff for the office too. There are some Starbucks physical stores where people can go in and buy coffee, tea, hot chocolate, pastries and other coffee accessories.
7. Originally India was a tea drinking country. But nowadays the consumption of coffee is getting increased in India because of fashion and interest t in Western brands and splendor products. And according to some researches, people visit cafes and order coffees more and more often. This is a very good time for Starbucks to enter Indian market, to the point, now according to the article this is a good time to start a business, because the Indian market has a great future. But they will face a lot of challenge like competitors and obesity related diseases.
8. Starbucks product supply is one of the keys in a successful expansion. They source coffee from any place other than South America and Indonesia. And India (Tata) meets all the standards and conditions that Starbucks abides.
Starbucks prices its products competitively and they adapt to the economical situation in a particular country. In India Starbucks’ products were priced according to the average income, that was lower compared to other markets where it already present. That suits Indian market
Starbucks expansion strategy also relies on licensing agreements, but only for locations where they can’t have an ability to open their own outlet. But it takes time to be sure about the partners because there are lots of speculations. And India understands that. So the Indian market is waiting for Starbucks no matter how much time it is going to take. India is ok with that.