starbucks SWOT
...sk so they can stay away from the countries that might hurt there business reputation or hurt there employees. The organization is dependant on a main competitive advantage, the retail of coffee. This could make them slow to diversify into other sectors should the need arise they have already done that with coffee cups and snacks and other drinks but it could get more difficult they are running out of ideas to keep them fresh and on top Opportunities Starbucks are very good at taking advantage of opportunities for example taking Japan in to the new American espresso age and it was successful. In 2004 the company created a CD-burning service in their Santa Monica (California USA) cafe with Hewlett Packard, where customers create their own music CD. This is not doing as well as expected and is not having a great impact on the music industry Starbucks has the opportunity to tweak it a little and make it work or they should drop it all together. New products and services that can be retailed in their cafes, such as Fair Trade products. The company has the opportunity to expand its global operations. New markets for coffee such as India and the Pacific Rim nations are beginning to emerge. Co-branding with other manufacturers of food and drink, and brand franchising to manufacturers of other goods and services both have potential. Threats The biggest rival to Starbucks is Dunkin Donuts. "Starbucks may own their experience, but Dunkin is nipping at their heels. Starbucks can't touch Dunkin in New England. Your thinking that is because of the doughnuts! But thats not true doughnuts are only 25% of the profit the rest comes from coffee and merchandise. In fact the coffee industry is growing so fast that Starbucks is look down at a lot of growing competition that is growing rapidly such as Dunkin Donuts, Krispy Kreme, Gloria Jean's Coffees, It's a Grind, Saxby's Coffee and Tea, Java Dave's Coffee House, Bear Creek Coffee, The Coffee Beanery, Port City Java, World's Best Coffee, Rockn' Joe, Java Jo'z, PJ's Coffee and Tea, and Javaology, and it begins to look like a java franchising tsunami. All of them, of course, are trying to out-Starbucks Starbucks. Since its conception in Pike Place Market, Seattle in 1971, Starbucks' success has lead to the market entry of many competitors and copy cat brands that pose potential threats. 'Starbucks' mission statement is 'Establish Starbucks as the premier purveyor of the finest coffee in the world while maintaining our uncompromising principles while we grow. 3. Does Starbucks have a competitive advantage and/or a competitive strategy? Justify your answer. In the global market Starbucks has a large advantage. I think this because Americans historically have been better at adapting to the effects of this creative destruction--at embracing them, even. Capitalizing on continuous change has been the basis, in part, of our national competitive advantage. For Example: the first Starbucks in Dublin, in Dublin, it's tough to get take-out coffee, more difficult still to get it in a cup larger than a thimble, and virtually impossible to find it before 9 in the morning. Irish consumers would quickly come to appreciate the American efficiency of Starbucks. So many customers would flock to the one Starbucks that within weeks one of the six Irish coffee shops would close. Starbucks has the upper hand in that country. In conversation, Schultz exudes an authentic, unbridled passion for his employees and their lives. He said you either have a tremendous love for what you do, and passion for it, or you don't, so whether I'm talking to a barista, a customer, or investor, I really communicate how I feel about our company, our mission, and our values. It's our collective passion that provides a competitive advantage in the marketplace because we love what we do and we're inspired to do it better. When you're around people who share a collective passion around a common purpose, there's no telling what you can do." http://www.businessweek.com/smallbiz/content/may2006/sb20060505_893499.htm?campaign_id=rss_topStories. Starbucks competitive strategy one of there strategies are not to lower prices and not to give free refills. Your thinking this sound like it will hurt the business, but if you think about it right you will understand people see a large price tag on any thing they start to think that product must be better than the cheaper product so it must be worth the price it is selling for they also have to keep there prices up so they can afford the best coffee the best cream the best coffee makers and the want to pay there employees well. They need to keep there prices up so they can keep there quality up. 4. Describe the components of the Starbucks value chain. Economic Development: Empowerment of coffee growers as active members of the coffee value chain, avoiding intermediaries, improving their family income by 50% thus improving their standards of living and permanence in the trade market in future generations. This will be achieved through the implementation of three main activities: Promoting the formation of productive chains and income generation above the poverty line; providing technical training to coffee growers; Improving production facilities and ownership. This makes growing the best coffee in the world possible. Eco-Friendly Techniques and Environmental Development: Introducing and setting up eco-friendly practice according to sustainable agricultural practices that will evolve into a more sustainable handling of the coffee growing industry in the long term. Social Development: Implement training and social assistance per family bringing courses and practical tools to administrate their own basic home finances, accounting, community organization, associations structuring, access to social services such as education, land titling, associative loans, health, utilities and preservation of their native culture, aspects to further promote their citizenship participation, living standards and self capacity to extend the projects benefits to more beneficiaries joining new coffee growers as part of the production chain. Main activities: Strengthen the community organiza...