CAFE COFFEE DAY

History of CCD

Logo

A traditional family owned a few acres of coffee estates, which yielded the rich coffee
beans in the soil of Chikkmagalur, However they soon amalgamated with Bean Coffee Trading
Company Limited, now popularly known as Coffee Day. The coffee growing tradition was since
1875, but the opportunity after the deregulation of the coffee board in the early nineties. Coffee
Day began exporting coffee to the connoisseurs across USA, Europe & Japan. In the calendar
year 2000, Coffee Day exported more than 27000 tonnes of coffee valued at US$ 60m to these
countries and, for the second time in its short career of 7 years retained the position as the largest
coffee exporter of India.

About Coffee Day

Coffee Day has a wide and professional network in the major coffee growing areas of the
country comprising over 50 agents and 50 collecting depots. Coffee Day's two curing works at
Chikmagalur and Hassan cure over 70,000 tonnes of coffee per annum, the largest in the country.
Coffee Day has a well-equipped roasting unit catering to the specific requirement of the
consumers. The process is carried out under the control of experienced personnel to meet
highest quality standards. The most modern technology available is used to maintain
consistency and roast the coffee beans to the demanding specifications of the discerning coffee
consumers.

Key Features

• 125 years of coffee growing history

• A fully equipped ISO certified roasting plant with a 70000 tonnes per annum capacity at
Hassan

• 5000 acres of self owned Coffee Plantations

• A ready and enviable base of more than 10000 suppliers

• Among the top exporters of coffee in India (Coffee Day

Exports)

Coffee Day Comprises of the following Sub Brands

• Coffee Day - Fresh & Ground

• Café Coffee Day

• Coffee Day – Vending

• Coffee Day – Xpress

• Coffee Day – Exports

• Coffee Day – Perfect

Introduction

Café Coffee Day currently owns and operates 169 cafes in all major cities in India. It is a part of
India's largest coffee company named Coffee Day, ISO 9002 certified company. Coffee Day's
most unique aspect is that it grows the coffee it serves in its cafes. Cafe Coffee Day's vending
machines have a special niche in the market compared to competitors because Cafe Coffee Day
machines offer filter coffee unlike the instant coffee offered by competitors' brands. Growing
from a coffee exporter to a coffee parlour, café coffee day has certainly come a long way in this
segment.
Key Features

• Pioneers of the Café Concept in India with its first Café at Brigade Road, Bangalore in 1996.
This Café was opened as a Cyber Café (first of its kind) but later, with the burst of cyber cafes it
reverted to its core competency….Coffee

• Essentially a youth oriented brand with majority of its customers falling in the 15-29 year age
bracket

• Each café, depending upon its size attracts between 400 and 800 customers daily

• At present it operates 169 cafes across 43 cities

• Plans to operate 200 cafes by December 2004

• It is a place where customers come to rejuvenate themselves and be themselves.

Product

Café Coffee Day’s menu ranges from hot and cold coffees to several other items. However,
the core product is the coffee. The management believes that trend is changing towards coffee.
So taking this opportunity, the company also sells coffee powder. Café Coffee Day also believes
in selling other merchandised products.

Core Product

• Exotic international coffees e.g. Capachinos

• Food items e.g. Sandwich, Samosas

• Desserts and pastries.

Supportive Products

• Funky Caps

• Cool T-Shirts

• Bags
• Mugs

• Coffee Filters

• Arabica

• Perfect

• Charge

• Dark Forest

Tie-Ups

CCD jointly organizes large number of promotions with the other companies serving the similar
target audience.

EBD Book Café

EBD is book café has joint ventures with CCD. EBD Book Café believes that by selling
books from within the espresso bars like CCD and other such co-locations that have a footfall of
over 100 plus customers in a day will help them to achieve growth in book sales. One can find
one’s favorite books at such cafes starting from fiction, nonfiction, religion, cookery,
management, lifestyle, art &craft, children books and much more. EBD Book Café are in
collaboration with Café Coffee Day have existing outlets in Ludhiana, Jaipur, New Delhi and
Kanpur and are in discussion to open more such outlets in, Mumbai and Ahmadabad. The CCD
bookshops are in the same premises though not necessarily inside the outlet.

Himalaya with CCD

To drive usage of honey, Himalaya Drugs is developing daily diet products and looking at
marketing them by tying-up with leading consumer brands.

It has tied up with Cafe Coffee Day, to create four dishes; Honey, Cappuccino, Honey
milk shake, Rich Chocolate Cake and ice cream topped with honey and nuts. The Cafe Coffee
Day partnership is unique. It provided a platform to reach out to the target audience in a relaxed
environment where they could experience innovative uses of honey. The association with Cafe
Coffee Day across 100 outlets in seven cities was not only to expand the category, but also
towards creating touch points to experience the goodness of Himalaya Forest Honey

Levi’s

CCD has also tied-up with Levis where CCD will promote Levis product in their cafes. Levi’s
recently launched their latest range of apparel, Levi’s 501, through CCD as part of their annual
laterals like Wall visuals, Tent cards, Posters and Door stickers. There is also a special Levi’s
Drink.

Movie launches

Apart form product launches, the company also does a number of tie-ups with the movie industry
in the same manner. For instance, there was Damdaar coffee that was sold during the launch of
the movie DUM. There was also the Damdaar contest wherein the prizes were movie tickets,
posters, CDs, and cassettes. In addition, the winners get a chance to meet and have a coffee with
the stars of the movie.

Vision of CCD

“To be the best café chain in the country by offering world class

coffee experience at affordable prices”.

Mission of CCD

 To be ranked no. 1 among the service sector.

 To provide the best quality services to customers at affordable prices.

 CCD is aiming to create its own niche merchandising like Indian coffee powder,
cookies, coffee mugs and curry paste.

Philosophy of CCD

Its philosophy is to provide world class trendy lifestyle products and experience to its
customers and in order to execute it, it has opened some new outlets with the facility of music
lounges, book cafes etc.
CCD Goals

Café Coffee Day, popularly known as CCD, would add around 100 stores every year
focusing on the metro markets. Besides and also look to tap the opportunities coming out from
the tier II and tier III places.

The company, which opened its first store in 1996 in Bengaluru, is presently operating 1,740
CCD stores in around 250 cities. On being asked about the expansion plan, Café Coffee Day
Chief Executive Officer Venu Madhav told PTI, "Eventually, we would be looking at 2,500
stores at least in a couple of years coming in ... We need to add about 800 stores. That the
eventual target we are looking for." According to him, as part of the expansion process, some
cafes would be closed and new stores would come at new locations. On being asked about the
time frame, Madhav added, "It would take 7-8 years to happen." ,"We would plan to add around
100 stores every year and then take it to wherever the opportunity is available," he added. As part
of its expansion, most of the CCD would come in the developed metro market, but the company
would explore the opportunities coming from tier II and tier III cities.

"Most of the new stores would be in tier 1, because the opportunity in tier I is bigger," he said
adding "We would also look on tier III places. Now, the consumption of coffee in India is on the
rise and several coffee chains like Starbucks, Costa Coffee are competing in the segment at
different price points. On being asked about competition in the segment, Madhav said that CCD
would focus on 'affordability' and 'value-conscious customers'. "Our target is youth and
affordable luxury. We are sticking to our positioning of what we need to do and create offering
which are for value-conscious customers. We are not worried about those things," he added.
Customer Profile

 37% lies in the age group 20 and 24

 27% between the age group of 25-29 years

 60% of the customers who visit the café are male and 40% are female

 52% of customers who visit the cafes are students

 18% of the customers visit the cafes daily while another 44% visit weekly.

The peak timings are

 7-9p.m.(Working Crowd)

 10:30 p.m.- 11.30 p.m. (Families)

Customer average spend and age

 Foot fall- around 115 per day

  The average spend: Rs.125-150/customer–1-3 p.m.

 Comprises primarily of youth from the 18-30 yrs age group

 Attracts a lot of people from the film industry

Marketing and advertising strategies of CCD

As we have discussed above, CCD’s strategic approach was based on the 3 A’s i.e.
Affordability, Accessibility, and Acceptability. 3A’s are the significant factors contributing to the
growth of the brand.

Secondly, Digital Marketing has become an integral part of Café Coffee Day’s marketing plan.
CCD’s fan base is overwhelmed with over 5 million fans on its social media pages and
consistently engaging customers on Facebook, Instagram, Twitter, Youtube, etc.

The youth was the key target and early adopters of trends, they also evolved their strategy and
became more digital-centric as they engaged with the new age world.

CCD marketing also constantly ensures the continuous active engagements of the consumers,
like they conducted the ‘Latte Art Festival’ – where customers were served coffee topped with
creative latte art designs.

As CCD goes digital, it is also looking at innovation in user experiences by adopting new
technologies to enhance customer service.

Cafe Coffee Day Competitors

Their main products are coffee, tea, pastries, cappuccino, beverages, and smoothies. The
coffees are sourced from many small coffee planters. CCD is basically considered as a young
hangout spot where they meet for various discussions. Through this article, let us discuss the
various Café Coffee Day competitors.
Direct Competitor

 Barista

 Cafe Mocha

 Costa Coffee

 Beyond Coffee

 Gloria Jeans

 Minerva Coffee Shop

Indirect Competitor

 McDonald

 Haldirams

Global Competitor

 Star Bucks

Competitors Analysis
Competitors and Launch year

Brand Name Launch Year

Starbucks 1971
Barista 2000
Cafe Mocha 2001
Costa Coffee 2010
Beyond Coffee 2012
Gloria Jeans 2008
Minerva Coffee Shop 1987
McDonald 1955
Haldirams 1983
Turn Over

The promoters are asking for a valuation of between four to five times of sales (in the coffee
business) on the back of some valuation trends in the industry both companies are privy to,” said
a source in the know of the matter.

The group’s coffee business expects to close the year ending March 2020 with sales of about Rs
2,250 crore, according to a senior company executive. The business, which includes some
exports of the bean, had revenue of Rs 1,777 crore and Rs 1,814 crore in fiscal ..
Employees

Cafe Coffee Day's revenue is the ranked 4th among it's top 10 competitors. The top 10
competitors average 2.6B. Cafe Coffee Day has 19,943 employees and is ranked 2nd among
from competitor.

Recruitment & Selection

It is the process of differentiating between applicants in order to identify those with a greater
likelihood of success in a job. The role of selection in an organization’s effectiveness is crucial
for at least two reasons; first work performance depends on individuals and second because of
the costs incurred in hiring individuals is enormous for an organization.
The best way to improve performance is to hire the people who have the competence and the
willingness to work. Arguing from the employee’s viewpoint poor or inappropriate choice can be
demoralizing to the individual concerned and demotivating for the rest of the workforce. The
cost of searching and training individual may range from Rs.2, 50,000.or more. Costs of wrong
selection are even greater.
Selection is a long process commencing from the preliminary interview of the applicant and
ending with the contract of employment. The process differs among organizations and between
two different jobs within the same organization. Selection procedure for senior managers is long-
drawn and rigorous but on the other hand for shop floor workers it is simple and short.

Human Resources
People at C.C.D. believe that “People are hired for what they know but fired for how they
behave.”

With the boost in the number of their retail outlets, Café Coffee Day had to concentrate on the
quality and quantity of their human resource in order to meet up with the set standards. They
make sure that the employees all across the country are well trained and provide consistent
services at every outlet.
Recruitment and selection process
For posts of team members the following rounds take place

 Psychometric tests, Behavioral Intelligence Test, Logical thinking and

Comprehension
 Test.
 Application blank.
 Personal Interview, Operations Interview, Regional Manager Interview.

Training & Development

To ensure consistent employee performance, training and development policies are very
important- even more in service sector organizations. Café Coffee Day has set 30 days rigorous
training procedure at their office for all the assistant managers.
Whereas all the team members undergo a 3 days training at respective head offices.

Employee working hours

The working hours are split into convenient shifts spread over 8:30 am to 10:30 pm.
Night drops are provided for late evening shifts.
Employee code of Conduct
 After substantial efforts Café Coffee Day has been able to convey to their staff (the ones
who serve food) that they are doing a job and are at par socially with many consumers.
 Their attitude and communications is kept up to mark.
 Along with cleaning the table well, their employees communicate with the consumers on
one to one basis. It is a cultural shift; it is a huge responsibility as, in India you do not
look at the people serving at your table as your peer
 Their employees are like friend to the customer but at the same time they know about the
international standards of hygiene and cleanliness and personal grooming.

Promotion Policy
Café Coffee Day prefers promoting from within, rather than externally.

Performance Appraisal
Performance management is an integral part of a comprehensive human resource management
strategy. Its objective is to maximize individuals' performance and potential with a view to
attaining organizational goals and enhancing overall effectiveness and productivity. The
immediate superior carries out the performance appraisal at Café Coffee Day every 6 months.

Employee Turnover & Retention

Café Coffee Day’s current rate of Employee Turnover is about 9%. The reason behind this is the
people between the age group of 19-24 who do not see their job as permanent means of income.
They are not committed towards the organization.

Accommodation

Accommodation is given for the out-station candidate after selection. Accommodation expenses
are deducted from the salary.
DUTIES

 They may work closely with regional managers and store owners to coordinate and
determine the most cost-effective marketing and hiring strategies, and align their
particular franchise with a retailer's parent business philosophy.
 Store managers use company software to draft proposals, recruit employees and research
and track products.
 On the floor, store managers must assemble the best possible sales team.
 They interview and selectively hire the most qualified candidates, provide time-efficient
and thorough training and maintain the skills and well-being of current staff with
motivational incentives and evaluations.
 In addition, managers must address customer needs by immediately resolving conflict,
inspiring long-term customer relationships and creatively placing and rotating
merchandise in a way that best catches customers' attention.

MAJOR TASK AND RESPONSIBILITIES

 Meeting with vendors and salespeople to order various food and supplies from various
companies.
 Setting a budget for wages, supplies and equipment and other expenses the café will
have.
 Determining the correct amount to charge for various items on the menu from coffee and
beverages through to food items.
 Greeting and talking with customers, getting feedback regarding both items offered on
the menu and service to the customers.
 Managing the accounts payable and receivable systems, contracting for bookkeeping and
accounting services or completing these tasks themselves.
 Hiring, training, supervising, promoting or firing staff as required. This may also include
lying off seasonal staff in some areas.
 Advertising and marketing the café, planning new campaigns to attract customers and
constantly expanding the client base.

KNOWLEDGE

 Prior Work Experience.

  Degree programs in restaurant management

 These programs are available as certificate, associate degree and bachelor's degree
programs.

 Restaurant management education programs (hospitality management or food service

management programs).

SKILLS:

 Ability to get staff motivated and having exceptional social skills,

 Hospitality Skills,
 Customer Service and Organizational skills,
 Excellent communication skills,
 Have the ability and knowledge necessary to solve the problems they may face,
 Supervision skills and teamwork skills,
 They also need to be extremely knowledgeable on all the products they sell.

FINDINGS

When asked about the most important factor that contributed to their choice of coffee
café, an equal number (40%) of respondents selected the taste of coffee/ food and the
ambience/ experience. Only 20% of them choose value for money as their most important
factor. Finding out how customers feel about the taste and quality of products offered,
could help both these organizations improve their share, by adapting and improving their
products.

The Coffee at Café Coffee Day seems to have a slight edge over Barista. This is quite an
important fact, considering Café Coffee Day uses its own brand of Coffee beans, while
Barista uses a combination of imported coffee beans and coffee beans from TATA Coffee.
Though most customers visit café for coffee, other drinks like Granitas, Cremosas,
smoothies and ice teas are very popular. Cafés need to focus on providing the right kind
of drinks in the right taste and with a certain level of quality.

Café customers usually have a light snack or side order along with what they are
drinking. This provides an opportunity for cafés to offer these eatables at marginally
higher prices, and increase their revenue. Increase in revenue though, would be useless if
they offered substandard eatables, which can often be caused by inefficiencies in storage
and distribution, which leads to eatables becoming stale. That’s why it is important for
cafés to provide high quality food, which allows them to charge a premium.

Café Coffee Day got a positive rating with respect to the variety of their eatables
(especially their Indian food), although the quality was often inconsistent. While,
respondents described Barista’s sandwiches as “tasteless” and “sometimes stale.

Overall, Café Coffee Day has done well to live up to its USP of being an affordable
brand.

Café Coffee Day’s delivery process involves a restaurant- like approach. When the order
is ready, and the customer has not collected it from the counter, a Café Coffee Day
attendant comes to the customers’ table and delivers the order. Café Coffee Day received
an excellent rating of 4.5/ 5 for this process. A lot of the respondents praised Café Coffee
Day for their delivery process.

A customer’s visit to a coffeehouse doesn’t end with his purchase of coffee. He goes there
for the service the organization provides, and this service is provided directly by the staff.
Café Coffee Day stayed at the above- average level.

One of the main characteristics of a service in intangibility. A major effect of intangibility

is that since the service cannot be seen or touched, it is very difficult communicating its
qualities or advantages to the customers. This also poses a problem in creating a brand
image for the organization. Café Coffee Day use their physical evidence to promote and
develop their brand. Also, considering that 40% of the sample stated Ambience/
Experience as the deciding factor in their choice of a coffeehouse, a lot of emphasis
needs to be placed on this aspect.

Customers come to a café because they want to have a good time with friends or family.
Other forms of entertainment at cafés are very useful for enriching customer experiences
and increasing customer retention. Music, T.V., games; books, etc are peripheral services
that a café offers to its customers. These services add to the overall ambience of the café.
Café Coffee Day has taken steps in the right direction as well, installing Q-Jam jukeboxes
 at every outlet. But besides that, they have nothing really to speak of. This is why they
only received an average rating of 3/ 5. They should concentrate more in this area,
because there is plenty of scope for improvement.

HR RECOMMENDATIONS

 Café Coffee Day has done extremely well so far to project itself as an affordable youth-
oriented brand. But there are still certain areas where their brand needs to be much stronger.

 With regard to the physical evidence associated with the brand, Café Coffee Day needs to do
a lot of work if they hope to catch up with Barista. My first recommendation for Café Coffee
Day is to clean up the décor at every outlet, wherever unnecessary advertising is taking place.

 Although it might be an important source of revenue, long-term customer perception of the

brand isn’t very positive.

 Café Coffee Day would do better to provide promotional space for its partners with the use of
clever collaborations, and not printed advertisements and posters everywhere.

 Café Coffee Day looks at its current recruitment, selection and most importantly, its current
training policies.

 Customers are not happy with the behavior and service of the staff, and Café Coffee Day is
lagging far behind Barista is this aspect.

Conclusion

 C.C.D. is the fastest growing Café in the country.

 The major competitor undoubtedly Barista.

 That Café Coffee day is planning to go international.

 The other major things regarding service marketing is that customers give top priority to the
quality of the services / products and ambience.

 It is providing tough competition to its competitors by satisfying its customers with great café
experience.
 A lot can happen over coffee‖ message has touched the hearts of youngsters who are the
largest consumers of C.C.D.

Latest Updates:
 As you know, Cafe coffee day chain is all over debt and also being presurized by the
lenders.

Coffee Day Enterprises being the parent company of Sical Logistics, has decided to sell
the entire stake in the company to ensure the debt removal of the company.

Report says, Coffee Day Enterprises has also hired ICICI Securities as adviser for the
potential transaction.
 As soon this news spread over the internet, the share price of sical logistics and also share
price of coffee day enterprise jumped to the highest and locked upon the upper circuit of
the day.
Financial Statistics of CCD:
Categories: Coffee, Food and Beverage, Retail
Headquarters Regions: Asia-Pacific (APAC)
Founded Date: 1996
Last Funding Type: Venture – Series Unknown
Number of Employees: 5001-10000
Legal Name: Coffee Day Global Limited
IPO Status: PrivateCompany
Type: For Profit
Website: www.cafecoffeeday.com
Facebook: Cafecoffeeday
LinkedIn : View on LinkedIn
Twitter: View on Twitter
Number of Funding Rounds: 3
Total Funding Amount: $71M
Number of Investors: 2
Cafe Coffee Day is funded by 2 investors. Brand Capital and Sequoia Capital India are the most
recent investors.

STARBUCKS

History of Starbucks:

Logo

Starbucks, American company that is the largest coffeehouse chain in the world.
Starbucks was founded by Jerry Baldwin, Gordon Bowker, and Zev Siegel, opening its first store
in 1971 across the street from the historic Pike Place Market in Seattle. The three Starbucks
founders had two things in common; they were all coming from academia, and they all
loved coffee and tea. They invested and borrowed some money to open the first store in Seattle
and named it “Starbucks” after the first mate in Herman Melville’s classic novel Moby Dick.
Alfred Peet, a coffee-roasting entrepreneur, was a major inspiration to the founders of Starbucks.
Peet was a Dutch immigrant who had begun importing fine arabica coffees into the United
States during the 1950s. In 1966 he opened a small store, Peet’s Coffee and Tea, in Berkeley,
California, that specialized in importing first-rate coffees and teas. Peet’s success encouraged the
Starbucks founders to base their business model on selling high-quality coffee beans and
equipment, and Peet’s became the initial supplier of green coffee beans to Starbucks. The
partners then purchased a used roaster from Holland, and Baldwin and Bowker experimented
with Alfred Peet’s roasting techniques to create their own blends and flavours.

By the early 1980s, Starbucks had opened four stores in Seattle that stood out from the
competitors with their top-quality fresh-roasted coffees. In 1980 Siegel decided to pursue other
interests and left the two remaining partners, with Baldwin assuming the role of company
president.

In 1981 Howard Schultz, a sales representative for Hammarplast, a Swedish company that made
kitchen equipment and housewares from which Starbucks bought drip-coffee makers, noticed
how large the company’s orders were, which prompted him to pay it a visit. Schultz was so
impressed that he decided to pursue a career at Starbucks, and he was hired as the head of
marketing in 1982. Schultz noticed that first-time customers sometimes felt uneasy in the stores
because of their lack of knowledge about fine coffees, so he worked with store employees on
developing customer-friendly sales skills and produced brochures that made it easy for customers
to learn about the company’s products.

Schultz’s biggest idea for the future of Starbucks came during the spring of 1983 when the
company sent him to Milan to attend an international housewares show. While in Italy, he was
impressed with the country’s cafés, and he thought of doing something similar in Starbucks.
However, Baldwin and Bowker were not enthusiastic about Schultz’s idea, as they did not want
Starbucks to deviate much from its traditional model of business. They wanted Starbucks to
remain strictly a coffee and equipment seller and not turn into a café that served espressos and
capuccinos.

Seeing that he would not be able to persuade Baldwin and Bowker to embrace the café idea,
Schultz left Starbucks in 1985 and started his own coffee chain called Il Giornale, which was an
immediate success, quickly expanding into multiple cities.

In March 1987 Baldwin and Bowker decided to sell Starbucks, and Schultz was quick to
purchase the company. He combined all his operations under the Starbucks brand and committed
to the café concept for the business, with additional sales of beans, equipment, and other items in
Starbucks stores. The company entered into a meteoric period of expansion that continued after
the company went public in 1992. Starbucks soon became the largest coffee-house chain in the
world. By the early 21st century, Starbucks had a presence in dozens of countries around the
globe and operated over 20,000 stores.

Vision of Starbucks:

 This instilled a vision at Starbucks to “treat people like family, and they will be
loyal and give their all.”

 The vision statement is articulated around the concept of family, loyalty, and
generosity.

 What it means from the business standpoint is that Starbucks is a place where
people spend a lot of time. Therefore, it has to feel like a second home.

Mission of Starbucks:

 To satisfy customers and to create a “third place” environment our Coffee.

 It has always been, and will always be, about quality. We’re passionate about
ethically sourcing the finest coffee beans, roasting them with great care, and
improving the lives of people who grow them. We care deeply about all of this;
our work is never done.
Goals of Starbucks:

Starbucks has developed a mission statement that includes cultural development,

innovation, high performance and accountability as elements of the company's values. The
corporate mission statement defines the company's goals.

Starbucks' mission is "to inspire and nurture the human spirit – one person, one cup and one
neighborhood at a time." The company aims to meet this goal through the development of a
culture that embraces acceptance and is supportive of personal growth. As stated in the
company's values, personal growth occurs through challenge and grows the company as well.
This goal of acceptance extends into the company's diversity and accessibility policies. Company
leaders are developed to lead multicultural teams of individuals with diverse perspectives and
insights that ensure company growth and improved service delivery for customers. The company
seeks to grow relationships with a diverse network of suppliers through strategic community
relationship-building.

Starbucks also strives to be open and genuine in its interactions with suppliers, employees and
customers. This is reflected in the company mission to drive performance without sacrificing
individual and corporate humanity. The company practices this value through its community-
building policies, which spur area development through investment. Starbucks values delivering
the very best service and accepting responsibility when expectations are not met.

Starbucks Consumer:

Starbucks’ primary target market is men and women who are aged 25 to 40. They account
for almost half (49 percent) of its total business (like the coffee chain’s consumers). Starbucks’
appeal to this consumer age group through hip, contemporary design that is consistent in its
advertising and decor. And working to keep its products current as status symbols.

The target audiences for Starbucks share a variety of characteristics, including a high-
income bracket, an awareness of social status and environmental consciousness. Starbucks’
recent decision to carry bakery products from San Francisco-based La Boulange has reinforced
the coffee chain’s upscale, artisanal image.
Starbucks’ young female customers place a premium on health and personal appearance. So the
chain targets them with lower-calorie “skinny” beverages. Recently, Starbucks has begun to
target affluent young families with products like organic fruit squeezes for toddlers and
containers of vanilla milk.

Starbucks’ primary target market is men and women aged 25 to 40. They account for
almost half (49 percent) of its total business. Starbucks’ appeal to this consumer age group
through hip, contemporary design that is consistent in its advertising and decor. And working to
keep its products current as status symbols. Customers tend to be urbanites with relatively high
income, professional careers and a focus on social welfare. This target audience grows at a rate
of 3 percent annually.

Young Adults

Young adults aged 18 to 24, total 40 percent of Starbucks’ sales. Starbucks positions itself
as a place college students can hang out, study, write term papers and meet people. A Starbucks
appeal to this consumer directly through introducing technology as soon as it comes available,
focusing on social networking and actively cultivating a “cool” image. The young adult audience
grows 4.6 percent each year.

Kids and Teens

Kids and teens are also a large part of Starbucks’ target audience. Together, customers
aged 13 to 17 accounts for just 2 percent of Starbucks’ sales, but most items for kids are
purchased by the parents. Whether the focus is on the steamed milk that Starbucks’ baristas refer
to as “babyccinos” or the sugary, caffeinated, whipped cream topped coffee drinks that are so
popular with teenagers, kids and teens form a large part of Starbucks business. Kids go there
with their parents; both mother and child leave with a cup in hand. Teens Meanwhile use
Starbucks as a place to hang out with friends or study. Starbucks may not cater directly to kids
(and risk criticism about the high calorie and caffeine content of some of its drinks) but it does
make its products kid-friendly, offering special child sizes for instance.

Complimentary Products
 Specialty coffee drinks account for around 75 percent of Starbucks’ sales, but an
increasing amount of its business is centered on selling whole bean coffees and merchandise.
Starbucks has made its coffees available for direct order online, in supermarkets and offered
select food service outlets the chance to carry Starbucks’ family of coffee, including Starbucks
brand, Seattle’s Best and Starbucks VIA. These products give consumers a chance to have the
“Starbucks’ experience” at home, and it is an area that Starbucks is pushing.

Starbucks Competitors

Starbucks Corporations is a coffee company founded in the USA in the year 1971 and operates
worldwide. As at 2016, Starbucks was operating in more than 23,500 locations worldwide with
an average of 240,000 employees. Its assets stood at $12.5 billion dollars with a net operating
income of $2.80 billion dollars. As a representative of ‘second wave coffee,’ Starbucks is known
for its distinguished quality coffee, top notch customer service and best-tasting coffee made from
espresso machines.

Some of its widely known products include Caffe Latte, espresso, Teavana tea products, fresh
juices like Frappuccino and snacks including chips and crackers not to mention bottled coffee
drinks, appetizers, wines and ice cream. Being a coffee producer, the following are the top 11
Starbucks competitors;

Direct Starbucks Competitors

1) Costa Coffee
This is the second largest coffeehouse in the world after Starbucks and the largest in the UK.
Founded in 1971 in the UK, Costa coffee has expanded to over 3000 stores in over 30 countries.
In the UK alone, it operates over 2000 restaurants. Mid this year, Costa coffee moved its coffee
roaster to Essex. An investment that cost a close to 40 million pounds. This, in turn, increased the
roasting capacity to 44,000 tons of coffee beans from the initial 11,000 tons in a year.

As at the end of 2016, Costa Coffee’s net income was approximate £153 million with revenues
exceeding £1.167 billion. This company reaches to its customers through its advertising slogan ‘a
coffee for every mile’ whose aim is to have as many coffee shops as possible. Costa Coffee is
also probably the only Starbucks Competitors on this list which exclusively deals and promotes
its coffee. All other brands have a combination of different products to offer.

2) McDonalds McCafe
McCafe is strongly coming up as one of the Starbucks Competitors which is gaining market
share. This is because of the backing it has with the huge number of McDonald’s stores across
the globe. This coffee house not only specializes in coffee but food and other beverages as well.
It was formed in Australia in the year 1993 and is a true reflection of espresso coffees. In the year
2015, McCafe was among the top three coffee sellers with over $1.4 billion from slightly over
4,500 outlets. However, this is set to increase after McCafe upgraded its equipment to ensure
consistency in the taste of its coffee.Currently, it’s ranked the largest in New Zealand and
Australia.

3) Dunkin Donuts
Dunkin is a donut company as well as a coffee house based in Massachusetts USA. Founded in
1950, it has expanded to become one of the largest baked food and coffee chain in the world. It
operates in more than 35 countries with over 11,500 restaurants. In the year 2010, its sales were
estimated to be 6 billion dollars and an estimated revenue stream of around US$828.9 Million as
per the 2016 data. In terms of production, Dunkins produces 8% donuts, 65% drinks and 27% of
other food items. Its presence in 35 countries itself tells the success story of the company.

4) Café Coffee Day

Café Coffee Day is another global company and largest Arabica beans producer and Exporter in
Asia. Started in 1996 CCD is now a world brand with its initial investment capital estimated to
be over160 million dollars. As at mid-2015, Café Coffee Day had over 1,500 outlets across 28
India states. The company is well known for vertically cutting down on costs; this is from
owning Arabica coffee plantations, making furniture for its outlets and also making coffee
machines. Even though it started in Asia, it has expanded to some countries in Africa, Czech
Republic, and Nepal.

Its initial marketing strategy was the change of original Logo with the new Logo showcasing the
chain as a ‘place to hold talks’ leading to total revamp of interiors and addition of lounges.

Indirect Starbucks Competitors

5) Independent Fast food chains & Bakeries

Coffee is not only sold in large chains but it is also sold in local bakeries and small coffee
centers. In fact, travel sites are generally full of coffee shops you should experience in a place
that you visit. These coffee shops are famous for their personalized service and the friendly staff
whom you know very well. As a result, the 100’s of coffee shops around the corner are the most
widespread Starbucks Competitors and a true competitor for the coffee chain. Starbucks has
itself strived hard to become the coffee shop around the corner. But across the world, there are
many many coffee shops which become an unorganized Starbucks Competitors.

6) McDonalds

Starbucks does not serve only Coffee but it also has small pizza’s and other eatables to
accompany the coffee. When we take the coffee out of the equation, Starbucks is literally a fast
food place as well. As a result, McDonalds can be considered a strong Starbucks Competitor.
McDonald’s is an American Fast foods store chain that was founded in the year 1940. As one of
the largest hamburger restaurant chains in the world, it operates 3700 outlets in over 100
countries.

To respond to different consumer tastes and preferences, McDonald’s also sells chicken products,
cheeseburgers, wraps, milkshakes, desserts, salads, fish, soft drinks, smoothies and a variety of
breakfast items. Its marketing strategies include franchising and change of logo. McDonald’s
also receives additional revenues from royalties, rent, and fees paid by franchisees. Even though
it started as a hamburger stand, its marketing techniques have propelled it to the global map.

According to the 2012 report published by BBC, McDonald’s is the 2nd largest private employer
after Walmart with almost 2 million employees of which 1.5 million are employed by franchises.

7) Kentucky Fried Chicken (KFC)

KFC is the world largest restaurant chain that specializes in fried chicken. Its headquarters in
Kentucky USA oversee operations of 20,000 branches worldwide in more than 120 countries.
Founded in 1952, KFC managed to popularize and market fast food chicken though franchising
and advertising. Advertising was done on televisions with the initial advertising budget estimated
to be around 4 million Dollars. In the late 1960s, KFC hired a national advertising agent by the
name ‘Leo Burnett’. In the mid-1970s, the Leo Burnett campaign dubbed ‘get a bucket of
chicken’ made KFC one of the most popular fast food chains in the USA.
Currently, its food menu has expanded to include french-fries, salads, side dishes, coleslaws and
soft drinks among others.

Indirect Starbucks Competitors in Tea Segment

These are mostly preferred tea brands that provide an alternative to Coffee. Naturally, they are
indirect Starbucks Competitors.

8) Tazo

Tazo Company produces herbal tea. Based in Portland, It initially started as a fieldwork and later
purchased by Starbucks who rebranded it to its current global status. Tazo Tea sells because of its
unique taste, aroma and medicinal qualities. According to 2010 data, Tazo revenues were
estimated to be $1.3 billion. Currently, it operates in more than 46 countries with over 17,000
stores operating under Starbucks.
9) Twinings

Twining is owned by the British Food Association. Its brand of tea has
gained international recognition due to its concentration, flavors, and Aroma. Since its inception
in the year 1706, it still maintains its market value and popularity. Twining tea contains a lot of
caffeine that acts a stimulant thereby helping one to be an active whole day long. In 2017, owing
to enormous consumption, it was voted among the top ten best tea brands in the world. With over
198 unique tea blends, it has an annual turnover of 8.5 billion dollars and employees around
43,000 employees.
10)Tetley

Tetley is one of the largest UK tea company. In the whole world, it’s the second largest tea
manufacturer. With specialization and expertise, Tetley produces over 65 different tea flavors all
over the world. In 2014 alone, it was estimated to have around 6.6 million consumers in the UK
alone. In the year 2006, for marketing reasons and to achieve dominance, Tetley brand was
purchased by Tata group at $1.4 billion dollars and rebranded to Tata tea which is currently the
second largest tea manufacturer in the world after Unilever.

After rebranding, it’s operating profits increased by 60% to around $61 million. It also
introduced fruit tea variants and high margin green tea. Tetley’s annual production stands at
60,000tonns and is valued at around $22 billion.
11) Dilmah

Dilmah Tea Company was founded in 1974 in Sri Lanka where tea was famously referred to us
Silone Tea.It late expanded to Indonesia, Turkey and 90 other countries. Dilmah Tea is now a
global brand thanks to the advertising and endorsement on the team jerseys’ by the Sri Lanka
national Cricket team. According to reports from Data-monitor, Ceylon tea which is Dilmah’s
parent company that was incorporated in 1981 is the 6th largest in the world with an estimated
revenue of $7.92 billion and net income of $1.04 billion.

Some of its brands include green tea, flavored tea, masala chai, Ceylon tea, herbal infusions,
iced tea et cetera.
12) The Republic of Tea

The Republic of tea is produced from the readily available organic products. It is usually packed
in loose tea bags and comes in different flavors and colors i.e. white tea and red tea. The colors
are as a result of red and white wine initially produced by the Republican company before it got
into tea production in the year 1992. As an initial wine manufacture, rebranding and advertising
have made it gain global accreditation with estimated revenues of around $20 million annually.
Its bestsellers include hot apple cider, pumpkin spice black tea, ginger peach and comfort and joy
black tea among others

Starbucks Turnover
Starbucks’ Total Revenue has grown by 16% between FY 2016 and FY 2018, and is
expected to grow by 10.3% in FY 2019:

 Starbuck’s total revenues grew from $21.3 billion in FY 2016 to $24.7 billion in FY
2018. This represents an increase of approximately 10.3%.

 We forecast the revenues to be around $27.3 billion in FY 2019, reflecting a increase of

10.3% y-o-y primarily due to Company owned stores segment.

Revenue growth of about $3.4 billion over two years driven by primarily contribution from
Company Owned Stores:

 The company operated stores are the highest contributor to total revenue and have seen
tremendous growth over the years. The segment revenue has increased from $16.8 billion
in 2016 to $19.7 billion in 2018. Trefis estimates revenue from the segment to be around
$22.9 billion in FY 2019.

 Licensed Stores segment has seen a good growth the past few years as the company
continues to add stores. The segment revenue grew from $2.2 billion in 2016 to $2.7
billion in 2018. Trefis estimates revenue from the segment to be around $2.8 billion in FY
2019.
  The consumer packaged goods segment is expected to have a fall in revenue after the
company’s deal with Nestle. The results from which are expected to start from FY 2020
onward. Trefis estimates revenue from the segment to be around $1.5 billion in FY 2019.

STARBUCKS NUMBER OF EMPLOYEES

Year US Outside US Total

The following table shows number of Starbucks employees 2007-18.

2007 144,000 28,000 172,000

2008 143,000 33,000 176,000

2009 1110,00 31,000 142,000

2010 107,000 30,000 137,000

2011 112,000 37,000 149,000

2012 120,000 40,000 160,000

2013 137,000 45,000 182,000

2014 141,000 50,000 191,000

2015 157,000 81,000 238,000

2016 170,000 84,000 254,000

2017 185,000 92,000 277,000

2018 181,000 100,000 291,000

Starbucks employees worldwide as of September 30, 2018 – 291,000.

Starbucks employees US – 191,000 people. Approximately 183,000 in company-operated stores
and 8,000 in support facilities, store development, and roasting, manufacturing, warehousing and
distribution operations.

Outside of the U.S. – Approximately 100,000 (approximately 97,000 in company-operated stores

and 3,000 in regional support operations.)

Apart from being the best coffee brand, Starbucks is also an employer of choice. It has
maintained an excellent culture that focuses on ethics and equality. Starbucks invests in its
employees so they can deliver a better customer experience. The total number of Starbucks
employees globally is approximately 2,77,000. In the last ten years, the number of employees has
increased by around a lac. In 2007, the number of total Starbucks employees was 172,000.
Investing in employees has its own benefits. Starbucks has always believed in having talented
people onboard. The number of US employees is higher than international employees; close to
double.

Human Resource Management and Recruitment Process

Human resource management(HRM), or the process of finding , developing and keeping the
right people to form a qualified work force, is one of the most difficult and important of all
management tasks. On the other hand, activities undertaken to attract, develop and maintain an
effective workforce within an organization. As the world well-known
company STARBUCKS which have their amazing individual HRM in their theory. With the
development of society, the individual HRM theory has been bring a lot of benefit for company
development.

A worldwide company with it’s culture of 5 be’s:

 Be Welcoming
 Be Knowledgable
  Be Considerate

 Be Genuine

 Be Involved

Starbucks is known to have the best management team and staffs because starbucks number one
mission statement is “provide a great work environment and treat each other with respect and
dignity.”

Employees
 Why is Starbucks different from other firms
 Every partner hired at Starbucks has to receive at least 24 hours of training in two weeks.

 Every employee has to master the ‘Star Skills’

 Starbucks support, inspire, and connect its partners. For that they have designed special
programmes.

1. Starbucks Experience – To learn about Starbucks, and its corporate culture.

2. Core 1&2 – To learn technical skills for becoming a successful Barista.

3. Supervisor Programme – For those who want to have a leadership role.

4. Retail manager in training – To set partners up for success in running their own Starbucks
store.

5. District manager training – To broaden the knowledge of a population

6. Plus – A wide range of management development opportunities, including topics such as

leadership, coaching and influencing.
Attracting Qualified Employee

RECRUITMENT

Recruiting is the process of developing a pool of qualified job applicants. Starbucks recruitment
could be divided into two section which are Support Centre and Retail. At our support centre,
Starbucks market support centrr, career opportunities span a wide range of functions and
departments. Departments include: finance, information technology, supply chain, marketing,
PR, human resources. On the other hand, for the retailing, Store Managers and assistant Store
Managers oversee the day-to-day operations of each Starbucks location. Store management
positions offer a great career experience for professionals with previous experience in retail
management, or for baristas who desire increased responsibility.

SELECTION

Selection is the process of gathering information about job applicants to decide who should be
offered a job. Starbucks will be thinking highly of applicants quality. During the selection, to test
the applicants questions would be asked concerning to their liking of drinking coffee or not. Here
Starbucks will to find people who match their values of liking coffee.

Developing Qualified Employee

TRAINING

Training is developing skills, experience and knowledge employees need to perform their jobs
and improve their performance. In this training session, employees are taught about coffee and
how to do well in pleasing the customers. The culture of Starbucks clearly states itself in three
‘C’s, which are Coffee, Connection, Culture. In the training program, the employees are well
trained to recognize coffee, and they are taught to communicate well within the business. There
is one more training every employee needs to acquire within 80 working hours in Starbucks
which are:

 Mastering the knowledge of coffee well.

 Sharing the knowledge of coffee with other people.
  Why Starbucks is the best.

 Mastering coffee beans, types of coffee, additives, growth region, baking and packaging.

 The right ways to smell and taste the coffee.

 Mastering how to describe taste of coffee.

PERFORMANCE APPRAISAL

The process of assessing how well employees are doing their jobs. One of the ways Starbucks
tries to improve this is by improving the measures by using as many performance objectives
possible, which is the measure of performance that is easily and directly counted or quantified.

Keeping Qualified Employees

COMPENSATION

Compensation is the financial and non-financial rewards that organization reward employees in
exchange for their work. In Starbucks, Partners that work full time or part time (20 hours or more
per week) may participate in a variety of programs.

Depending on job and personal situation, a partner’s total pay package may include:

 Competitive pay
 Insurance : medical, life

 Bonuses

 Paid Time Off

 Retirement Saving Plan

 Stock Option And Discounted Stock Purchase Plan

 Emergency Financial Aid

 A Free Pound Of Coffee Each Week

Planning

Planning is a management function that assesses the environmental management to set goals and
map out future activities to achieve those goals.

The process which Starbucks assure that they have the right kinds and number of people at the
right times in the right places, people who are efficiently and capable of effectively completing
those tasks will help the organization to achieve its goals called Employment planning.
Employment planning then translates the organization’s goals into an HR plan that allow the
organization to achieve these goals. The process can be condensed into 2 steps

 Assessing current and future human resource needs

 Developing a plan to meet those needs

Organizing

Organizing is a management function that determines how the company’s human, financial,
physical, information and technical resources developed and coordinated to perform tasks to
achieve objectives.

Organizing is something vital for Starbucks. Job analysis is an organizing process because
information about a given job organizes by Starbucks through performing a job analysis to
identify the responsibilities, skills and tasks that it entails and the abilities and knowledge that
needed.

Starbucks retain competent, high performing employees, managing employee performance and
developing an appropriate compensation and benefits program play a role in this organizing
process.

Leading
Leading is the management function that energizes employees to contribute their best
individually and in collaboration with others. Leading or directing is the process of trying to
influence others to achieve organizational goals. People who are responsible for specific tasks
task manager is designed to motivate and to help them achieve their goals and thus the common
goals of the organization (Schultz, 1997).

The process by which efforts are directed, energized and sustained toward attain a goal is
motivation. Motivation has three key elements1: Direction2: Energy 3: Persistence According to
Maslow’s hierarchy of needs theory is within every person Motivation and Maslow’s hierarchy
are linked together. For example, incentives given by Schultz to employees will motivate them
because it fulfils individual’s need as shown as hierarchy table.

What seem to be the most important things leading to the success of this company?

There are many small companies developed to larger and famous companies in this worldwide,
they do not rely on luck but they have their own strategy to success which includes how well
they perform PLOC function in their organization. Starbucks is growing in the international
market. When people see a logo which is green and has a twin-tailed mermaid, what goes into
their mind? Those people definitely will think of Starbucks due to the companyis becoming a
leading global company by making a difference in people’s lives all around the world.

The management of Starbucks apply the philosophy of the CEO, Howard Schultz, which is “treat
people like family and they will be loyal and give their all” that becomes one of the factors
which leads the company success. Not only full time staff he introduced benefits, but also to
those part time staff. To motivate the employees to work hard for the company to succeed, the
employees are offered with flexible work schedule, health insurance, and treat the employees
with respect. The company shares offered to its employee by the CEO with the name of ‘Bean
Stock’. With these benefits offered, the employees give the best service to the customers because
customers are the important asset of the company by providing a training and development
program for employees to fulfill the requirement of their customers.

The second factor leading to the company to succeed is the company has innovation to create
new types of coffee or new drinks to attract more customers, increase the company’s profit and
allow the company to have an upper hand in the market. The benefits given to the staff cause the
staff to give everything to the company including their innovation. As an example, the latest
product of Starbucks in the market is salted caramel mocha. Starbucks not only sell coffee and
juice blend, they sell food which are pastries and cakes to allow the customers to have some tea
break.

What do you see as the major challenges facing by this company over the next five years?

Although Starbucks is success in managing human resources which cause it to succeed in the
international market, challenges still has to face and overcome it to allow the company to success
continuously. Starbucks has a lot of competitors but Starbucks is still over them. However,
Starbucks has a major competitor currently or maybe in the future which is McDonald’s
McCafes. Dunkin Donuts is not consider the major competitor of Starbucks because there is a
few outlets in Malaysia and those outlets are located in Kuala Lumpur only. On the other hand,
Starbucks has 115 stores all over Malaysia which is much more than Dunkin Donuts. For
McCafes, although it has only one outlet in Damansara, it still well known and people are going
there to try the coffee and muffins. Thus, McCafes might be rival competitor in future.

In additional, McDonald’s uses Starbucks high price directly against the company in their
marketing campaigns, 75% of its profits are based on its coffee products and other specialty
beverages (Starbucks Corporation, 2010). It means that every time the price of coffee rises
Starbucks will take a direct hit. On the other side, McDonald’s focus first on food and then only
coffee, thus makes the company less vulnerable to the rise of coffee prices around the world.

Finding

Starbucks employees play an important role to success. “We built the Starbucks brand first with
our people, not with consumers.We believed the best way to meet and exceed the expectations of
our customers was to hire and train great people, we invested in employees.”(Schultz,
1986).Starbucks provides welfare for the employees. “Schultz’s rationale was that if you treat
your employees well, they will treat your customers well.” (Associated Press, Sept 2005).Hence,
in order to make the company success, Starbucks offers all full-time and part-time employees to
enjoy the benefits such as high wages, full health care. Moreover, Howard Schultz offers
company shares to employees and elderly care program for their parents. Lastly, a program
called the CUP Fund which helps employees with financial assistance for the one who are in
financial crisis and even bonuses. These incentives are used to motivate employees to treat
customer and company right as the company treats them well. The pros of this management
using by Starbucks is to help to reduce Starbucks’s employee turnover. Starbucks employees tend
to be young and healthy which keeps the cost of health benefits low. Due to the low-partner
turnover, the training cost has been reduced and it will indirectly increase the income of the
company. Besides, in 1997, researcher showed that he average customer went back 18 times per
month (Schultz and Jones, 1997). The low-partner turnover may contribute to customer loyalty
and customers developed a relationship with the baristas serving coffee. The cons of the
implementation of the strategy is that the eligibility of the employees to receive the benefits. The
employees in Starbucks can only eligible for benefits on the first day of the second month after
they have been paid for at least 160 hours by the last Friday of a consecutive two-month period.
(Canada, Effective October 2005) It may lead to the long-time working for the employees and
finally they will resign and choose to work for a company with less benefit and less working
hours.

Starbucks also uses Human Resource Planning (HRP) to attract, develop and retain quality
employees. The organization employs talented employees through selection process. The
selection process consists of certain steps. For Starbucks, the most essential part of evaluating a
candidate is through interview. The aspects that employers looks within the employees are
characteristic, personality, confidential, expectation of interviewer, knowledge of the company
history in the coffee shop industry, work ethic and so on. With this interview, employers are able
to understand more or knowing sets of skills of each individual candidate. With this Human
Resource Planning (HRP), it aids the company to prepare ahead of time for vacancies rather than
solving in a complicated manner when an employee decided to resign unexpectedly. This
prepares Starbucks for future opportunities such as business growth and expansion. Another pro
of Human Resource Planning (HRP) is having career-development. Identifying potential capable
company leaders, company will help them to grow. For an instance, Starbucks has a program
called “New Partner Orientation and Immersion”. What it does is giving an extensive program to
increase the quality of Starbucks core values; build knowledge of business and retail operations;
create awareness about Starbucks benefits programs and introduce partners to their key internal
stakeholders. (DeniseBrandenberg, eHow Contributor)

Besides, the recruitment method used by Starbucks which is interview contains advantages and
disadvantages. Traditionally, the interview has been the main means of evaluating the right
candidates for a job. Almost all organizations use the interview at some stage in their selection
process. Similarly, most applicants expect to be interviewed. Personal characteristics as practical
intelligence and interpersonal and communication skills can assessed by interviews. The
interview can be used for answering applicants’ questions, selling the organization and
negotiating terms and conditions. Contrarily, it is doubt that interview can really evaluate
correctly on the ability at work, work skill and relevant experience of the employees. (Build an
Interview, 2008) A further problem with interviews is that factors that are not related to the job
such as clothing, color, ethnic origin, gender, accent, physical features or a disability influence
the decision. There is also evidence that interview is relatively simple and such a fast method to
collect data information that able to get in applicants’ resume or curriculum vitae might never
obvious even on a written form. (Build an Interview, 2008)

Conclusion

Starbucks’ popularity grew so fast that nothing like it was seen before. Starbucks has self-
declared as the world’s leading dealer, roaster and brand of specialty coffee with more than
13000 outlets in 39 countries. It created a business out of good quality employees, reliable
partnership connections, community involvement, public responsibilities and superior services.
All these factors together with its history and background contributed to Starbucks’ success in
business. Although there are many boulders and conflicts, Starbucks has ways to deal with it
because it’s good management. Starbucks number one priority is to always satisfy customers.
Firstly, they listen attentively to everything the customers have to say and try their best to please
them. This to gain the customers trust and respect its importance to ensure company’s survival as
customers is the main source for company’s income. A company as flexible and unique like
Starbucks able to perform at peak and climb to the top.

What we have learned from this assignment, Starbucks success due to many factors. Firstly,
Starbucks hires good employees. Employees are important; tsshey can break or make a company.
Therefore Starbucks only hire and recruit the right person, train them well, motivate them to try
their best and retain them to gain competitive advantage, Starbucks deploy human resources.
Like other companies, has Human Resource Management to attract, develop and retain only
good and suitable employees. Starbucks’ management stressed about the importance of pleasing
customers. Employees are trained to be more independent, taking daring measures if necessary,
to make sure customers are fully satisfied-the theme is to “just say yes” to customer requests.

Other factors for Starbucks success are due to value and principles. There are certain key values
and guiding principles used in Starbucks culture by Howard Schultz and senior executives.”To
build a company with soul” isthe basis value in the effort that Starbucks pursuing the perfect cup
of coffee ceaselessly. The company also have strict quality control for its product and will never
use artificially flavoured coffee beans.

Moreover, Starbuck slow employee turnover rates. With Starbucks compensation and welfare
provided to all employees, it satisfies the employee’s needs. Schultz believes that customer
satisfaction is directly proportional to employee’s satisfaction.

Lastly, we realize the use and importance of Human Resource Planning (HRP). With the use of
HRP, it can improve the utilization of human resources, achieve economies in hiring new
workers. Importance of HRP are able to maximize use of manpower, to anticipate additions of
problems, to determine training levels and works and know the cost of manpower.