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Starbucks’
S TRATEGY AND
PES T ANALYSIS

   NEVROZ
  GÖS TER İ C İ
Overview


 Established in 1971 at Seattle, Washington
 Famous for its quality fresh-roasted coffee beans
  and stylish atmosphere.
 Over 9,000 stores worldwide
 Product lines include :
      − beverages (coffee, Tazo tea, soda, juices)
      − pastries
      − whole coffee beans
      − coffee-related hardware and equipment
      − merchandise (mug, CDs)
Starbucks’ Strategy

 Rapid     store expansion strategy
  •   Domestic store expansion
  •   International store expansion
  •   Employee Training and Recognition
  •   Real Estate, Store Design, Planning, and Construction
  •   Store ambience

 Product      Line
 Coffee     purchasing strategy
Starbucks’ Strategy

Rapid store expansion strategy

•   Domestic store expansion
    − A three-year expansion strategy
    − “Starbucks everywhere” approach

•   International store expansion
    − Company-owned and company-operated stores or licensing
    − Created a new subsidiary, Starbucks Coffee International
    − Expanded its consumer products channel in South Pacific region
Starbucks’ Strategy

•   Employee Training and Recognition
    − Systems to recruit, hire and train baristas and
      store managers
           screening
           training programs
           awards for partners

•   Real Estate, Store Design, Planning, and Construction
    − A broad range of store formats (the right image and character)
    − A “stores of the future” project team
    − High-traffic, high-visibility store locations
    − Control of average store opening costs
    − Wi-Fi availability at stores
Starbucks’ Strategy

•   Store ambience
    − The concept of “everything matters”
    − Assessment of standards
Starbucks’ Strategy

Product Line

•Wide range of products choices
•Special product promotion
•Selling music CDs
•Joint ventures
                PepsiCo
                Dreyer’s Grand Ice Cream
                 Jim Beam Brands
•Acquisitions
                 Hear Music
                 Ethos Water
•Starbucks Cards
•Partnership with Bank One
Starbucks’ Strategy

Coffee purchasing strategy
•   Building relationship with growers and exporters, checking on
    agricultural conditions and crop yields, and searching out varieties
    and sources that would meet Starbucks’ standards.
•   Using fixed-price purchase commitment and purchasing coffee
    future contracts
•   Contributing to the sustainability of coffee growers and helping
    environment conservation
•   Purchasing and marketing Fair Trade Certified coffee
•   Promoting coffee cultivation methods that protected biodiversity and
    maintained a healthy environment
PEST Analysis

Political   Influences
        − Relationships between U.S. and countries producing coffee
beans
        − Environmental regulations
        − Industry-specific regulations

Economic      Influences
        − Demand for food and beverages
        − Customers’ buying power
        − Exchange rate & taxation
PEST Analysis

Social   Influences
      − Trend
      − Consumer preferences
      − Changes in lifestyle and occupation
      − Education

Technological     Influences
      − advances in manufacture
       − biotech and agricultural development
  − IT developments

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Starbucks' strategy and pest analyses 1

  • 1. Starbucks’ S TRATEGY AND PES T ANALYSIS NEVROZ GÖS TER İ C İ
  • 2. Overview  Established in 1971 at Seattle, Washington  Famous for its quality fresh-roasted coffee beans and stylish atmosphere.  Over 9,000 stores worldwide  Product lines include : − beverages (coffee, Tazo tea, soda, juices) − pastries − whole coffee beans − coffee-related hardware and equipment − merchandise (mug, CDs)
  • 3. Starbucks’ Strategy  Rapid store expansion strategy • Domestic store expansion • International store expansion • Employee Training and Recognition • Real Estate, Store Design, Planning, and Construction • Store ambience  Product Line  Coffee purchasing strategy
  • 4. Starbucks’ Strategy Rapid store expansion strategy • Domestic store expansion − A three-year expansion strategy − “Starbucks everywhere” approach • International store expansion − Company-owned and company-operated stores or licensing − Created a new subsidiary, Starbucks Coffee International − Expanded its consumer products channel in South Pacific region
  • 5. Starbucks’ Strategy • Employee Training and Recognition − Systems to recruit, hire and train baristas and store managers  screening  training programs  awards for partners • Real Estate, Store Design, Planning, and Construction − A broad range of store formats (the right image and character) − A “stores of the future” project team − High-traffic, high-visibility store locations − Control of average store opening costs − Wi-Fi availability at stores
  • 6. Starbucks’ Strategy • Store ambience − The concept of “everything matters” − Assessment of standards
  • 7. Starbucks’ Strategy Product Line •Wide range of products choices •Special product promotion •Selling music CDs •Joint ventures PepsiCo Dreyer’s Grand Ice Cream  Jim Beam Brands •Acquisitions  Hear Music  Ethos Water •Starbucks Cards •Partnership with Bank One
  • 8. Starbucks’ Strategy Coffee purchasing strategy • Building relationship with growers and exporters, checking on agricultural conditions and crop yields, and searching out varieties and sources that would meet Starbucks’ standards. • Using fixed-price purchase commitment and purchasing coffee future contracts • Contributing to the sustainability of coffee growers and helping environment conservation • Purchasing and marketing Fair Trade Certified coffee • Promoting coffee cultivation methods that protected biodiversity and maintained a healthy environment
  • 9. PEST Analysis Political Influences − Relationships between U.S. and countries producing coffee beans − Environmental regulations − Industry-specific regulations Economic Influences − Demand for food and beverages − Customers’ buying power − Exchange rate & taxation
  • 10. PEST Analysis Social Influences − Trend − Consumer preferences − Changes in lifestyle and occupation − Education Technological Influences − advances in manufacture − biotech and agricultural development − IT developments

Editor's Notes

  1. 3 year : favorable demographic profile, could be serviced and supported by the company’s operations infrastructure Everywhere : cut down on delivery & management costs, shortened customer lines at individual stores, increased foot traffic for all stores in an area. Expand: sell Frappucino in Japan, Taiwan and South Korea
  2. 3 year : favorable demographic profile, could be serviced and supported by the company’s operations infrastructure Everywhere : cut down on delivery & management costs, shortened customer lines at individual stores, increased foot traffic for all stores in an area. Expand: sell Frappucino in Japan, Taiwan and South Korea
  3. 3 year : favorable demographic profile, could be serviced and supported by the company’s operations infrastructure Everywhere : cut down on delivery & management costs, shortened customer lines at individual stores, increased foot traffic for all stores in an area. Expand: sell Frappucino in Japan, Taiwan and South Korea
  4. 3 year : favorable demographic profile, could be serviced and supported by the company’s operations infrastructure Everywhere : cut down on delivery & management costs, shortened customer lines at individual stores, increased foot traffic for all stores in an area. Expand: sell Frappucino in Japan, Taiwan and South Korea
  5. 3 year : favorable demographic profile, could be serviced and supported by the company’s operations infrastructure Everywhere : cut down on delivery & management costs, shortened customer lines at individual stores, increased foot traffic for all stores in an area. Expand: sell Frappucino in Japan, Taiwan and South Korea
  6. Sourcing from multi geographic areas to find wide ranges of coffee varieties. Fixed : limit exposure to price fluctuation Future : provide price protection Sustainability : 3-5 years contracts, reward the farmers with financial incentives and preferred supplier status