Starbucks

From the above strategic analysis of Starbucks, we can say Starbucks is working in growing industry and it is the leader of industry. Starbucks is quite proactive about its future, its decision of purchasing coffee from China and India will help in controlling the costs and maintaining its strategy of differentiation. Besides differentiation strategy Starbucks has transitional strategy that is helping it to grow internationally. Because of Starbucks ability to adopt local culture in different countries, we can say the business model of Starbucks can be adopted by any international business. The core competence of Starbucks is its corporate knowledge where people always are eager to gain knowledge about the industry. Starbucks is a global company and from its strategic analysis we can say Starbucks has no immediate threat of decline in its performance.

Recommendations

Although Starbucks has expanded itself internationally, but most of its stores are domestic and it has only 30% presence internationally (“Starbucks Coffee Company- Investor Relations- Financial Highlights,” 2009). The strategic recommendations for Starbucks are international expansion to ensure its growth and sustainability. There are 5,727 stores Starbucks has internationally while it has 11,131 stores in the United States (Starbucks Corporation, 2010). In order to gain more consumer base and ensure sustainability in the long run Starbucks has to expand globally. The Starbucks can open new stores internationally in the countries where it has a presence already in order to enhance its profits beyond the United States (“Starbucks Coffee Company- Investor Relations- Financial Highlights,”2009). While expanding internationally Starbucks has to adopt the local culture and tradition, as incorporating local culture and traditions can greatly affect the profits (Bartlett, Ghoshal, & Beamish, 2008).So there is a need for research and understanding while moving to new cultures. Another reason for expanding the international operations is growing economies of India, China, Russia and Brazil, as these countries have the potential of buying and incorporating coffee in their culture.

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