Strategic Analysis of Starbucks Ruchir Gupta Roll
Autor: ruchirgupta807 • April 24, 2015 • Term Paper • 3,937 Words (16 Pages) • 1,085 Views
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Strategic Analysis of Starbucks
Name : - Ruchir Gupta
Roll No:-23
Q1. Update the case for March 2015 and comment briefly current market position of Starbucks.
ANSWER:
From 2006 to 2014, Starbucks, the coffee retailer, continued with the astounding financial performance. Sales had increased from $7.8 billion to $16.45 billion, and net profits, from $540 million to $3.1 billion. The company is currently operating in 66 countries with 21878 stores out of which 11962 are in the US and remaining international and is working on a target of opening 3-4 stores every day. Currently it holds a market share of 36% and its major competitors are Dunkin Donuts. Starbucks has been growing at almost 25%. Net income has risen around 3.1 billion. The Coffee shop industry revenue is 30 billion growing at 2.7%.
Starbucks has tied with Square - a popular loyalty platform and a highly rated smartphone app, for enhancing its payment capabilities. It has the right infrastructure to grow in emerging markets like India and China. Recent acquisitions, the company’s investment in ventures like Square and its own rollout of single-serve products such as VIA, K-Cups and a Verisimo brewing system are other key drivers.
Starbucks has brought about the following changes in its global operations after 2006:
- Entered into the following countries
- 2007 – Denmark, Netherlands, Romania, Russia
- 2008 – Argentina, Belgium, Bulgaria, Czech republic and Portugal
- 2009 – Aruba and Poland
- 2010 – El Salvador, Hungary and Sweden
- 2011 – Guatemala, Curacao and Morocco
- 2012 – Costa Rica, Finland, INDIA and Norway
- 2013 – Vietnam and Monaco
- 2014 – Brunei and Colombia
- Other activities:
- Eliminated trans fat and made 2% milk as the new standard
- Acquired Coffee equipment company and its Clover brewing system
- Online presence: Launched my Starbucks idea for customer engagement and created its presence on Twitter and Facebook
- Launched Starbucks VIA Ready Brew Coffee
- Opened East Africa’s Farmer Support center in Rwanda
- Launched Starbucks loyalty program
- Launched Starbucks Card Mobile Payment
- Expanded digital offering for customers with free unlimited Wi-Fi, Starbucks digital Network
- Launched Starbucks K-Cups portion packs
- Acquired Evolution Fresh
- Introduced Starbucks Blonde Roast
- Launched Verismo system for premium customers
- Acquired La Boulange
- Acquired Teavana getting into tea category
- Introduced Danone’s Yogurt products
- Launched Tweet-a-coffee
- Collaborated with Oprah Winfrey for Tea branding
Q2. Using the relevant diagram and strategic framework, position Starbucks today on Porter’s Generic Strategies. What was Starbucks business model in 2006? How has it changed today? Explain briefly your reasons for the change in the Starbucks Business Model over last 9 years.
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