STARBUCKS COFFEE

INTRODUCTION
Starbucks Corporation - an American
global coffee company based in Seattle, Washington.
Largest coffee-house company in the world with 20,891
stores in 62 countries.
President and CEO - Howard Schultz.
Places high value on ethical behaviour and companywide diversity.
Initially started with coffee equipments and coffee
beans than latter came up with coffee and other
beverages, various food items, refreshments and
pastries.

COMPANY HISTORY
1971- Starbucks founded by Jerry Baldwin, Zev Siegal
and Gordon Bowker as a single store in Seattles Pike
Place Market.
1982- Schultz joins the Starbucks team.
1983- While travelling in Italy, Schultz experiences
Italian Coffee bars and inspires him.
1985- Schultz leaves Starbucks to open II Giornale, a
company serving espresso drinks using Starbucks
coffee beans.
1987- Schultz purchases Starbucks from the founders
and begins to expand throughout the US.
1992- Starbucks Company goes public.

MISSION STATEMENT
To inspire and nurture the human spirit one person,
one cup and one neighbourhood at a time.
This is done through their commitment to the
following principles:
1)To provide best Coffee
2) Help the community
3) Customers satisfaction
4) Protecting the environment
5) Neighbourhoods

COMPANY PROFILE
Starbuckss logo is inspired by the sea featuring a
twin-tailed siren from Greek mythology.
Our Coffee: Believes in serving the best coffee
possible - goal is to grow our coffee under the highest
standards of quality using ethical sourcing practicesour coffee buyers personally travel to coffee farms in
Latin America, Africa and Asia to select the highest
quality arabica beans.
Our Stores: Perfect place for meeting friends and
family or enjoying a quiet moment alone with a book

Our Partners: Our employees, who we call partners, are at the

heart of the Starbucks Experience- our store partners are
committed to coffee knowledge, product expertise and customer
service.
Our Products:

1) Coffee: More than 30 blends and single-origin premium Arabica

coffees.
2) Handcrafted beverages: Fresh-brewed coffee, hot and iced
espresso beverages, coffee and non-coffee blended beverages,
Vivanno smoothies and Tazo teas.
3) Merchandise: Coffee and tea brewing equipment, mugs and
accessories, packaged goods, music, books and gift items.
4) Fresh Food: Baked-pastries, sandwiches, salad, oatmeal, fruit-

ANALYSIS
STRENGTH
- Starbucks is the market leader in the coffee
Market.
- Customers are satisfied with the quality and
taste of Coffee.
- High brand equity.
- Operating in 40 countries worldwide.
- Huge number of employees approx. 13
thousand.

WEAKNESS
- Pricing are higher as compared to the
competitors.
- High operating cost
- The business profits are highly
dependent on coffee product.

OPPORTUNITY
- Entry into Asian market like Pakistan, India and
Bangladesh.
- Market penetration in International countries.
- Co-branding with other food manufactures.
- Whole bean sales in supermarkets like.

THREATS:
- Numbers of competitors are increasing, like
Barista, Caf coffee Day, Gloria jeans coffee.
- Variation in coffee prices in developing countries
- People started to become more health conscious
- Labour Unions issues in US and international
countries
- Starbucks facing huge resistance in international
countries over cultural and political issues.

COMPETITIVE
STRATEGY
Focused differentiation
by serve niche buyers
better than rivals.

Buyers have distinctive

preferences, special
requirements, or unique
needs.

Have unique
capabilities to
serve needs of
target buyer
segment.

Starbucks has resources

and capabilities to
effectively serve an
attractive niche.

Costly or difficult for

multi-segment
competitors to meet
specialized needs of
niche members.

Big enough to be
profitable and offers
good growth
potential.

CORPORATE SOCIAL
RESPONSIBILITY
Ethical sourcing: To develop strong, long-term
relationships with farmers to ensure that they buy the
high-quality coffee our customers expect. By 2015, their
coffee will be grown using ethical trading and
responsible growing practices.
Environmental Stewardship: By 2015, 100% of the
cups will be reusable or recyclable and reduce their
environmental footprint through energy and water
conservation, recycling and green conservation.
Community Involvement: They believe in being
involved in the communities they are part of-bringing
people together, inspiring change and making a
difference in peoples lives.

By 2015, they plan to contribute one million volunteers

hours each year to our communities.
As a result of this today they have16700 world wide
stores, 142000 employees and revenue of 9.8 billions

ORGANIZATIONAL STRUCTURE

Basic Structure:
Around the country, district managers oversee
regional groupings of stores who report directly to the Starbucks
Corporation. At each store, a store manager acts as the chief and
under him are a collection of shift supervisors who act as managers on
duty when the store manager is out. Below the shift supervisors are
the rest of the employees, referred to as baristas.
Licensed Stores: Starbucks does not operate under a franchise
system but they do license storefronts. Licensed stores are common in
grocery stores, bookstores or any other site where the Starbucks is not
a stand-alone building and are still controlled by Starbucks
Corporation and must adhere to the same guidelines. All items sold at
licensed stores, including foods, must be approved by Starbucks
corporate offices. Starbucks maintains this control in an attempt to
protect the company name and ensure that it remains one that is
associated with quality.

Partners: While Starbucks workers also have more

specific titles, including barista and shift supervisor, the
Starbucks corporation has long referred to their workers
as "partners." This term is intended to make clear how
integral Starbucks employees are to the company's
success.
Responsibility: Starbucks aims to work ethically with all
of its suppliers, offering the providers of their fine Arabica
coffees fair value for the beans they work so hard to grow.
The company also practices environmental friendliness,
choosing eco-friendly options whenever possible.

ORGANIZATIONAL CULTURE
They strive to create a culture that values and respect
diversity and inclusion.
They expect to be a leader in diversity and inclusion,
from our partners in the field to our senior leadership
teams.
Theyexpect that all leaders within Starbucks practice
a behaviour that demonstrates inclusion.
The goalsof the Diversity and Inclusion team include
building a diverse workforce, increasing cultural
competencies, shaping a culture of inclusion and
developing a diverse network of suppliers.

WORK ETHICS
Starbucks believes that conducting business ethically
and striving to do the right thing are vital to the success
of the company.
Business Ethics and Compliance: Program that
supports their Starbucks Mission and helps protect their
culture and their reputation by providing resources that
help partners make ethical decisions at work.
The program develops and distributes awareness
materials, facilitates legal compliance and ethics
training, investigates sensitive issues such as potential
conflicts of interest and provides additional channels for
partners to voice concerns.

CHALLENGES
Blending in the Indian Culture: CCD and Barrista
have imbibed the culture in their regular offerings. For
e.g., they offer seasonal drinks like Aam Panna, Mango
shake etc in the summer season.
Price Sensitivity: Indian consumers by nature are very
price sensitive. A regular simple small coffee costs the
consumer as much as Rs. 45/- and the more popular
coffee like Cappuccino and Latte would require the
consumers to shell out almost Rs. 90/- for a small cup.
Competitive Rivalry: Starbucks will be facing tough
competition from other brands like CCD, Barrista
Lavazza and Costa Coffee. All of them have been in the
industry for almost 5-6 yrs.

ANSOFF MATRIX IN STARBUCKS

Market penetration

Product Development

Market Development

Diversification

Q1. Starbucks has worked hard to act ethically and

responsibly. Has it done a good job communicating it efforts
to consumers? Do consumers believe Starbucks as is a
responsible company? Why or why not?

Starbucks has partnered with Conservation International

Coffee purchased will be grown using responsible growing

practices & ethically traded

It works continuously with farmers

Q2. Where does a company like Starbucks draw the line on

supporting socially responsible programs? For e.g., how much of its
annual budget should go towards these programs? How much time
should employees focus on them? Which programs should it
support?

Starbucks has partnered with Product Red, it is donating 5 cents from

each sale of Ethos bottled water & has pledged to donate $10 million as
a part of the program.
Starbucks has a plan to expand its community service by its employees
& customers volunteering over 1 million hrs annually till the end of
2015.
The coffee cups are made up of 10% postconsumer fiber which can be
100% recyclable.
Starbucks currently spends $12 million annually towards CSR.
It should continue with all these programs and should increase
its share more towards environmental programs in the coming
years.

Q3. How do you measure the results of Starbuckss socially

responsible programs?

THANK YOU