Starbucks’ Expansion in Asia

Title: Starbucks’ Expansion in Asia

View Point: Howard Schultz - Director of Retail Operations

Time Context: Present / 1996 Before Starbucks expansion in Singapore

I. Statement of the Problem

- The growth rate of Starbucks in other countries is slowing due to financial crisis, Store Cannibalization and cultural issues

II. Statement of the Objective

- The objective of Starbucks is to increase its market share to other countries

III. Areas of Consideration

Strengths

• Quality coffee beverages

• Excellent Customer service

• Many Joint Venture Partners

• Expands Abroad Extensively

Weaknesses

• Expensive products

• Store cannibalization

• No roasting plants in Asia

• Poor merchandising efforts

Opportunities

• Brand Extension

• Increasing number of foreign countries in Asia

• High consumption of coffee

• Expanding retail outlets

Threats

• Cultural issues in other countries

• Financial crisis of foreign countries

• Imitation of their product

• Heavy competition of its rivals

IV. Alternative Courses of Action

1. Build a roasting facility in Japan or Singapore to trim down operation cost

2. Focus on continuous product improvement and avoid store cannibalization

3. To make the coffee production automatic

V. Analysis

ACA 1:

Advantages

• It will give access to Asian countries on coffee products without the long wait for the shipment from Kent, Washington

• Products will be almost readily available to retail stores

• Shorter waiting time will avoid coffee products