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people.
We are in the people business, serving
coffee”
Company Overview
1971 - Starbucks Coffee opens is first
store in the Pike Place Market in Seattle,
Washington
1984 - Howard Schultz convinces the
original founders of Starbucks to test the
coffee bar concept
1988 - Starbucks comes out with their
first mail-order catalog, enabling mail-
ordering of their coffee in all 50 states
Company Overview
1991 - Starbucks becomes the first
U.S. privately owned company in
history to offer a stock option
program (Bean Stock) to all its
employees
1992 - They go public, with common
stock being traded on NASDAQ
1993 - Expands into the East Cost
market
Product
Extension:
Discoveries (cold
coffee)
Place
Demographic &
Psychographic
segmentation
SWOT Analysis
Strengths
› Never experienced a strike or work stoppage
› Good relationships with coffee suppliers
› Value employees
› Located in high traffic areas
› Employee turnover rate is 60%, compared to
140% in the fast food business
› They don’t move into new markets until they
dominate the ones they expand into
SWOT Analysis
Weaknesses
› Excessive focus
› Employees report to two division heads
› Increasing shareholders dilutes their
interest
› They have expanded too quickly, and
have already saturated the US market
› They do not allow smoking in their
stores, alienating some of their
customers
SWOT Analysis
Opportunities
› Expansion into European and Latin American markets
› Distribution agreements, such as hotels, airlines, and
office coffee suppliers
› Reducing alcohol consumption in the US leads to bars
being used less which leads to people needing another
place to go
› Use supermarkets as a way of expanding into
international markets
› Numerous brand extension
› Improve on perception of instant and decaffeinated
coffee to expand that market share
SWOT Analysis
Threats
› The coffee market is saturated
› Cost of coffee beans is expected to rise in the
near future
› Supermarkets threaten whole bean sales
› Farmers might switch from coffee to vegetable
crops
› High competition from Japanese competitors
› Consumers trend toward more healthful fare
COMPETITO
RS
Starbucks faces competition from a number
of international, national, regional, and even
local coffee bars and houses.
The more well known international ones
would be :
Coffee Bean
San Francisco Coffee
Gloria Jeans
The local Competitors would be :
Secret Recipe
Oldtown White Coffee
COMPETITO
RS
Starbucks competitors are primarily in the
Restaurants & Cafes industry.
Starbucks also competes in the Nonalcoholic
Beverages, Candy & Confections, and Consumer
Electronics & Appliances Retail sectors.
Is comfortable facing Coffee Bean and Tea Leaf
as its major competitor but, with the upcoming
and modernized kopitiams, it is now quite an
issue for Starbucks.
COMPETITO
RS
Fortune ranked Starbucks number one in
innovation, quality of management, people
management and quality of products or
services in the food industry 2007.
According to The Star online, in Malaysia,
Starbucks currently holds 45% to 50% of
local gourmet coffee market.
Starbucks is still the world and Malaysia
leader in its industry.
Starbucks is constantly innovating and
showing strong product differentiation in
their industry.
Is aware of the threats to potential entrants
since the profit is attractiveness.
• Starbucks outlets
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