Star Bucks Analysis - Candidate Statement

UNIVERSITY | WORD LIMIT 1500

DATE: 2/07/2012

ASSIGNMENT TOPIC: STAR BUCKS ANALYSIS

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Answer -1.1

Porter’s five Forces of analysis Starbucks Company and its industry

Number Name of Force Level

High or Medium or Low Your Analysis

Reason of your level

1 Rivalry Among Existing firms High 1. Rivalry from other competitive coffee chains like Tea Leaf, coffee bean, San Francisco coffee house etc.

2. Other smaller privately owned coffee shops.

3. Secondary provides of coffee like McDonalds, Dunkin Donuts, Burger kind etc (Strehle and Cruickshank 2004).

4. Other competitors selling similar kind of products like High quality foods, speciality coffee.

5. Other products like cold drinks and other beverages etc (Strehle and Cruickshank 2004).

2 Threat of New Entrants Medium 1. The entry barrier is relatively In the coffee industry

2. Any large funded company having large capital can easily enter the industry can become a potential threat (Hitt, Ireland and Hoskisson 2012).

3. Some major threats are the ongoing fast food retail chains like McDonalds, Dunkin Donuts etc (Boyes 2011).

4. Having controlled access to the distribution channel is also one of the reasons.

5. Product differentiation and Innovation are also the reason for the threat of new entrant (Hitt, Ireland and Hoskisson 2012).

3 Threat of Substitute Products Moderate 1. Lower or less luxury coffee shops.

2. Places