Case Study: Starbucks

Case Study: Starbucks

Introduction

Starbucks Corporation is the ranked number one in the coffee retailer. Starbucks own about 9000 coffee shops in different countries. Starbucks president and CEO Mr. Howard Shultz, follow a philosophy that a company should value its employees so that employees will value its customer.

Although the first Starbucks opened in 1971 it wasn't until the 1990s that the company became the iconic coffee symbol of America. Starbucks' popularity exploded alongside a changing generation of young Americans who were on the move and connected to the world-wide-web, while yearning for bigger and better, no matter the cost. This generation quickly became known as the “Starbucks Generation” and now, a decade later; it's spilling over into a thriving China. Starbucks entered China in 1999 and has now made it their number one target for growth.

Starbucks Corporation is an international chain of coffee, which started its business from Seattle. Starbucks are the world's largest coffee company, which has approximately 18,000 stores in more than fifty countries. Starbucks sells coffee brewed, espresso hot drinks and other drinks, along with snacks and some other products such as cups and grains of coffee. It also offers books, music CDs, and movies. In 1971, Starbucks launched its first store in Seattle, Washington, which involved three partners. The three partners included Jerry Baldwin, Zev Siegel, and Gordon Bowker. These three persons highly inspired by an entrepreneur named Alfred Peet, who had a coffee shop that sold coffee beans and machines, since 1971 to 1976. At first, Alfred Peet managed to attract a pool of customers in the first year. However, the customers started to buy green coffee from other suppliers . In 1982, there three partners joined by Howard Schultz, an entrepreneur who suggested that the company needed to expand the sales of coffee beans, selling espresso and others, which they rejected. The founders considered that the new activity would distract the company's original goal also believed that coffee was something to be prepared at home.

Howard convinced about his idea that it would certainly make more money by offering pre-made coffee to the Americans. As a result, Howard Schultz opened, in 1985, his own chain of coffee shops under the name II Giornale. A year earlier, the three original founders decided to buy the company of Alfred Peet, “Peet's”. Furthermore, the founders sold the coffee shop chain “Starbucks” to Howard Schutz, who then decided to change the company name II Giornale to Starbucks. In 1987, the new Starbucks opened the first premises on the outskirts of Seattle and Chicago. The company joined the stock exchange on June 26th of 1992, since then, the shares have had a sustained growth reaching U.S. $39 in 2006. However, the company showed a negative growth in the following year as the share price decreased to $17(Gonzalez,Nigh,2005).

External Analysis

External Environment Threats

The biggest threat facing Starbuck is the possibility of increased competition or over expansion by Starbucks itself. Starbucks need to maintain consistency throughout it stores around the ...