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Strategic Report
Starbucks Corporation
Starbucks Corporation is an American founded company that
was created in 1971 in Seattle
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The Starbucks product portfolio includes:
Roasted and handcrafted high quality coffee, tea, fresh food and other drinks
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Starbucks are a Public limited company but began as a single
store in 1971 in Seattle’s historic Pike Place Market
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Their mission:
To inspire and nurture the human spirit – one person, one cup and one
Neighborhood at a time
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To accomplish its mission, Starbucks has principles that guide all of its employees as
they go about their daily activities within the workplace
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Their Partners – They always treat each other with respect and dignity
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Their Customers – When they are fully engaged, they connect with, laugh with, and
uplift the lives of their customers – even if just for a few moments
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Always full of humanity
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Their Shareholders - They are fully accountable to get each of these elements right
so that Starbucks – and everyone it touches – can endure and thrive
Starbucks vision was to become a national company with values and guiding
Principles that employees could be proud of
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The Starbucks
Digital network would give Starbucks customers’ free access to digital content
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All their
coffee would be grown communities
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Recyclable By 2015

So far they have achieved their goals by becoming the most successful and biggest
coffee shop in the industry compared to other corporations such as Costa and also
have achieved recyclable cups in the year 2015 (this year)
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They are smart as they are specific
and measurable as the year 2015 is the deadline they aspire to achieve their goals
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And they have achieved the goals in the time given (2 years
according to the Starbucks website)
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This shows that Starbucks are extremely successful
since they sell their products at a premium price, they still attract lower
demographics as they glamourize a simple product
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This gives them a worldwide reputation and
almost guarantees a constant flow of loyal customers resulting in a constant
flow of revenue
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 Starbucks have joint ventures with different companies such as ‘Dreyers
grand ice cream’, Kraft Foods Inc
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, Barnes and Nobles and Hyatt
hotels corp and many others, this then strengthens their reputation and they
are joining up with other trusted brands and then this makes the customers
have a stronger trust in the company and brings more loyal consumers
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 Starbucks have good product diversification this means their customers
expect something different than their competitors which then gives
Starbucks a USP
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 Starbucks have a “leave no one behind” scheme
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Therefore resulting
them being more loyal to the business and then because the staff are more
motivated this means that the customers will receive better service and
become loyal due to the satisfaction of quality products as well as quality
service by the staff resulting in an increase in revenue
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This means Starbucks are still paying the full
price to run the store but less customers are willing to pay the price
leading to a decrease in revenue
...
This
means the needs of other stores worldwide are not getting the attention
they need and that means that the products produced are related to the
demand of the US market only
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 Starbucks have high employee related costs
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This means
that Starbucks can expand and broaden their market
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 Starbucks have the opportunity to partner with other companies to
increase sales, like it has done in the past
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Threats –
 The rise in costs of coffee and dairy products is an issue that could
cause Starbucks to not be able to function as well because they
cannot afford to start sourcing cheaper raw materials because if they
do that they will become less of an ethical business as the reason they
charge a lot of money for their products is because its USP is high
quality coffee therefore they need the best coffee beans and dairy
products
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 Starbucks have a lot of competitors who are also big franchises who
all have objectives that starbucks don’t have for example mcdonalds
mcCafe ,costa and local coffee shops

Ansoff Matrix
Starbucks have achieved market penetration by promoting its products in many
ways
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Starbucks are constantly improving their products through innovation
and introducing new coffee flavors to give the consumers more variety at the
moment of ordering
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Starbucks have developed new products for the existing coffee houses to attract a
new market such as the barrels and the home brand coffee that consumers can
purchase in store or supermarkets and brew at home
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With these products consumers have a different option when going to the
coffee house, as well as new consumers that are searching for breakfasts
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They are constantly trying to enter
new countries to offer their worldwide known products
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This is a way to analyse
Ecuador’s market and make further decisions for implementing more coffee houses
in Ecuador
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These products are usually based on the country’s culture and demand,
which are different from Starbuck’s original products as different countries have
different values and they need to make sure they promote the right values to their
customers
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From this I can infer that
Starbuck’s is gaining its lost consumers and loyalty to the brand
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All these factors and much more are
essential for the growth of Starbucks in the US as in other counties
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Approaching
market saturation in many markets has a discouraging influence on new entrants
and the economies of scales is a substantial entry barrier in this industry
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Although the absence of customer switching costs from Starbucks to other stores
may attract new competitors to the industry, survival in the global coffee-chain
industry is currently associated with massive capital investments and this fact can be
referred to as an additional entry barrier to the industry
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There is little or no direct
substitution to Starbucks core products, since the company sells a comprehensive
range of non-alcoholic drinks including, coffee, tea, juices, energy drinks and water
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Rivalry among existing firms is fierce
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Starbucks Corporation Report contains more detailed discussion of Starbucks
Porter’s Five Forces analysis
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The Ceo of Starbucks is Howard D
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He is best
known as the chairman and CEO of Starbucks and a former owner of the Seattle
SuperSonics
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In 1998,
Schultz co-founded Maveron, an investment group, with Dan Levitan
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5 billion
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The strategic goal for Starbucks in 2015 is that
100% of their cups will be recyclable
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Considering that they had a tarnished reputation from their previous scandal when
the press discovered that Starbucks kept their taps running 24/7 to stop bacteria
from getting into the taps
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Corporate social report
Starbucks has spent the whole year of 2014/5 reducing waste with Reusable Cups
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Since 1985 Starbucks have rewarded their customers with a discount when they
bring in personal tumblers, and have a goal to serve 5% of the beverages made in
their stores in tumblers and mugs brought in by customers
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9 million times, up
from 35
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4 million pounds of paper from
landfills
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5% to 1
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In January 2013 they launched a $1 reusable cup in the U
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and Canada, and a £1
cup in the United Kingdom in April
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Reducing the environmental impact of their business operations will have the effect
of safeguarding the availability of high-quality coffee beans that meet their
standards and to help preserve the planet for future generations
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In 2014 Starbucks released a limited time coffee that demonstrated the benefits of
their ethical approach
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It was a special coffee that resulted in the growth of their ethical reputation and
trust from the customers
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This helps them to identify and test effective
strategies for improving the sustainability of coffee production processes, the
conservation and restoration of natural habitat and opportunities to facilitate farmer
access to forest carbon markets or other payment for environmental services
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In Mexico, They helped more than 260 farmers in 23 communities in 2013 and
helped them protect over 620 hectares
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Starbucks have also put work in and has been able to provide more than 10,000
seedlings for 325 coffee farmers, supporting their future farms and growth of their
communities
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Starbucks are helping farmers gain access
to existing government programs that provide cash incentives for forest
conservation, preservation and restoration
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They have more than eight million
loyalty members, seven million mobile payment transactions each week and over $4 billion
loaded onto prepaid Starbucks Cards in North America in the past year alone, Starbucks
offers the largest and most robust mobile ecosystem of any retailer in the world
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Starbucks introduced its fully-integrated
Mobile Order & Pay platform – representing the most meaningful enhancement to the
customer ordering experience since the company first introduced drive-thrus in 1994 – to
customers in the Portland, Oregon area
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The Portland launch will be followed by a national rollout
of Mobile Order & Pay in 2015
This is expected to show a substantial rise in revenue and customer loyalty
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They are
expecting to gain in customers overall as their competitors are not seen to be taking
advantage of recent technological advancements
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By introducing the expansion, the
consumers worldwide have access to this new factor and have begun entering the rising ecommerce market
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Finance 1
P+L account in appendicies
Gross profit margin for 2013,14 and 15

Sept
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31, 2014
Sept
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31, 2013
Sept
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66%
59
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25%
58
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78%
58
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94%
57
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88%
57
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Without these ratios Starbucks would struggle to be able clearly assess
what they need to do to improve
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Starbucks 5 - year plan
Starbucks China and Asia-Pacific region represent enormous, immediate, high-value
opportunities for the company, and Starbucks announced plans to double its store
count in China – to over 3,000 stores – by 2019
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Starbucks is the industry leader in premium single serves, premium packaged roast
and ground coffee, and Ready-to-Drink products served outside the company’s retail
stores and are ideally positioned to grow its share of these markets both in the U
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and globally
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S
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