Starbucks

Presented By
Wajid Ali
Hussam Qadir
MBA 2 Years 4th Semester
 Vision and Mission Statement
• Vision:

“To establish Starbucks as the premier purveyor of the finest coffee in the
world while maintaining our uncompromising principles while we grow”

• Mission:

“To inspire and nurture the human spirit – One person, One cup and One
Neighborhood at a time”
 Contents
1. Introduction
2. History
3. Business strategies
4. Strategic Analysis
5. Financial Overview
6. SWOT Analysis
7. Recommendations for Future Strategy
 Introduction
• Starbucks is an American coffee
company and coffee house chain. It
was founded in Seattle, Washington
in 1971
• Starbucks is known as the most
famous coffee in around the world
• It is a successful company in selling
coffee and has been attractive
among various ethnicities
 Brief History
• Founded in 1971 in Seattle, Washington, specializing
in high-quality coffee and brewing products starbucks

• Name and logo were inspired by the sea and Herman

Melville’s Moby (Novel whaling Ind)

• In 1981, Howard Schultz, recognizing its potential,

joined Starbucks. After experiencing the café culture
in Italy, Schultz envisioned Starbucks as a café
community in the U.S
 Brief History

• By 1997, Starbucks had expanded internationally,

entering Japan and Singapore, and introducing new

product lines

• By 2009, Starbucks operated 16,706 stores across 50

countries

• Starbucks became the largest buyer of Fair Trade

Certified™ coffee,
 Starbucks Products
• Starbucks offers a variety of products, including
drinks, food, and at-home items:
• Drinks: Starbucks offers many types of drinks,
including:
• Coffee: Fresh-brewed coffee, hot and iced
espresso, Frappuccino blended beverages,
Starbucks Refreshers, smoothies, and Teas
• Holiday drinks: Seasonal drinks like the
Peppermint Mocha, which combines espresso
roast, steamed milk, mocha sauce, peppermint
syrup, whipped cream, and dark chocolate curls
• Food: Breakfast, bakery treats, sandwiches, toasties,
chocolate, and snacks
• At-home items: Whole bean, Starbucks capsules etc
 Starbucks Products

Some of Starbucks' signature drinks

include:
• Peppermint Mocha: A holiday drink
that combines Starbucks Espresso Roast
with steamed milk, mocha sauce,
peppermint-flavored syrup, whipped
cream, and dark chocolate curls

• Frappuccino: A blended beverage that

can be made with coffee or non-coffee
flavors
 Business Strategies
The key Business Strategies of Starbucks are
• Premium Product Offering
Focus on high-quality coffee and diverse
menu options, to enhance customer
satisfaction
• Exceptional Customer Experience
Emphasizes the “third place” concept with
cozy store ambiance, friendly staff, and
personalized interactions
• Digital Innovation
Starbucks App and Rewards Program boost
convenience and loyalty through mobile
ordering, payment, and delivery
 Business Strategies
• Global Expansion

Localized menus and strategic partnerships enable success in

diverse markets worldwide

• Strong Branding and Marketing

Relies on brand image, word-of-mouth, and social media rather

than heavy advertising

• Operational Excellence

Consistent quality, employee training, and supply chain control

optimize efficiency and customer satisfaction

• Innovation and Trends

Regularly launches new products, including health-conscious

and tech-driven offerings, to stay ahead of trends
 Business Strategies

New Growth Strategies:

• Expansion in foreign markets with partnerships to

reduce risks and costs

• Introduction of products like VIA instant coffee and

other retail innovations

• Focused branding for sub-brands like Seattle’s Best

Coffee
 Strategic Analysis
• Lifecycle Position:
Starbucks is in the mature stage of its
lifecycle with slowed growth but global
diversification
• Boston Matrix
Cash Cows: Core products like Lattes and
Frappuccino's.
Stars: International locations and emerging
innovations.
Question Marks: VIA instant coffee and sub-
brands like Seattle’s Best.
• Competition in the Industry (Strong • Threat of New Entrants (Moderate Force):
Force) New entrants can challenge Starbucks by adopting
High competition within the coffee and eatery market lower pricing strategies or introducing innovation.
However, Starbucks' established global brand and
forces Starbucks to maintain its premium quality and
market position reduce this threat.
differentiated products to stay competitive.
• Key Factors:
• Key Factors: • Moderate Forces:
• Strong Forces: Moderate cost of starting a coffee shop encourages new
Large number of competitors due to low entry and exit competitors.
barriers. Supply chain costs are manageable for entrants.
Low switching costs for customers, making it easy to • Weak Forces:
try other brands. The scale of Starbucks’ global brand and the high cost of
replicating its infrastructure discourage competition.
• Moderate Forces: An average number of moderately-
sized competitors reduces some intensity. • Mitigation: Brand loyalty, strong supply chain
• Mitigation: Starbucks leverages its market share, management, and exclusive supplier access protect
strong brand reputation, and differentiated offerings. Starbucks from new entrants
• Bargaining Power of Suppliers (Weak Force) • Bargaining Power of Customers (Strong Force)
Starbucks’ global supplier network, volume Customers wield strong influence due to price
orders, and ability to switch suppliers easily sensitivity, numerous alternatives, and negligible
minimize suppliers' influence. switching costs.
• Key Factors: • Key Factors:
• Moderate Force: • Strong Forces:
• Individual suppliers are moderately sized, but • Insignificant switching costs encourage customers
Starbucks' order volumes ensure collaboration. to try competitors.
• Weak Forces: • Abundant substitutes for coffee products increase
customer choice.
• Numerous suppliers globally.
• Weak Force:
• Starbucks' partnerships with farmers and diversity
policies reduce dependency on any single supplier. • Individual customers make small purchases, which
lessens their overall influence.
• Mitigation: Strong supplier relationships and
• Mitigation: Starbucks attracts loyal, quality-
high purchasing power ensure stable operations. sensitive customers through premium offerings, a
diverse product mix, and innovative marketing.
• Threat of Substitute Products or Services
(Strong Force)
• Summary: Starbucks faces strong competition
from substitute products like tea, energy drinks,
and home-brewed coffee due to low switching
costs and pricing.
• Key Factors:
• Strong Forces:
• Large availability of substitute products in the market.
• Low price points of substitutes.
• Negligible switching costs make it easy for customers to
change preferences.
• Mitigation: Starbucks counters this with
superior quality, brand loyalty, and innovative
product lines.
 Financial Strategy
• Financial statement
shows there is increase in
comprehensive Income in
2023 as compared to
2022 but decreases as
compared to 2022
• How ever there is
decrease in 7% in global
sale due to Palestine and
Israel conflict in year
2024.
 SWOT Analysis
• Strengths:
• Strong brand identity and global presence.
• High-quality products and ethical sourcing.
• Convenient locations with a focus on ambiance.
• Weaknesses:
• Overexposure and product over-diversification.
• Risky investments in U.S. store expansions.
• Opportunities:
• Customization and digital innovations.
• Growth in international markets
• Threats:Rising competition from McDonald’s McCafé
and Dunkin’ Donuts.
• Economic pressures affecting consumer spending.
 Recommendations for Future Strategy

• Enhance customization by allowing users to create

and order unique drinks online and through mobile
apps.

• Embrace digital innovations for user engagement,

including online profiles, mobile ordering, and drink
suggestions.

• Focus on international markets for stable growth and

innovation opportunities

• Leverage the brand’s strong reputation to maintain