Starbucks Strategy

1. Executive Summary

The role of Strategy Management is the study of managing the process in order to produce goods and services. Independently of whether we are talking about small business or corporate, managing strategy remains vital in order for the enterprise to function effectively. Production industry would of course consist of much more complicated process of managing strategy, because it involves design and creation of the product, its development, followed by distribution and coordinating several product lines if applies. One of the very important parts of the strategy management is effectiveness and efficiency of the production process, that’s means time, cost and quality, those are very important for operational management.

2. Introduction

Starbucks created cautiously with growers in Africa, South and Central America, and Asia-Pacific regions to assure the superior of its product. Starbucks connected all employees' "partners" and shaped harder to alternation them with the abilities all-important to best serve the customer. The environment at Starbucks was crafted afterwards the European-style espresso bar. Since the starting of Starbucks principle, the business strives for achievement through expanded development and market share. In 1956, Starbucks's first shopping centre was opened in 1960, the string of connections of 212 business shops, supplementing another 144 shops in 1964 (Goetz Sutton 2007). This development tendency set with Starbucks Company accomplishes the name of market foremost in the retail nourishment commerce in the United Kingdom in 1995. 1990 was assessed by Starbucks increase spectacularly, inserting a broad variety of markets, encompassing new geographic markets and new markets. Armstrong (2003) devotes the next charts display the Starbucks in distinct geographical positions, functioning in 11 worldwide markets.

3. Market Environment Analysis


- Customer Focus: Starbuck's is committed to give equal concentration on its forward and backward integration
- Cooperative Relationship: Starbuck's has open minded discussion with suppliers and full flow of communication of opinions and ideas
- Management by Fact: It is continuously monitoring and assessing suppliers’ performances
- Continuous Improvement: The firm engaged in improving the supply chain processes to meet customer’s needs and prevent problems from arising
- Leadership: Top management cultivates cooperative culture with suppliers, commits to a long term relationship with suppliers and quality performance
- Supply Chain Management Excellence: Satisfaction is well aligned with supplier’s contribution and vice versa.

3.1. Micro Environment

Starbuck’s is a leader in food retail with the largest share in the market. The company has bullied its great position on the UK market from 1974 and currently Starbuck’s serves an estimate of 2 million customers per day. During last ten years the corporation suffered because of their image “junk food” seller. The healthy food segment of the food market was not targeted by the company. The changes in the customer’s behavior forced Starbuck’s to make additions to their menu and to revise company image. In order to keep up with the competitors like Subway, the company introduced low calorie salads and deli sandwiches, backed up with the big promotional and educational activities. Starbuck’s is currently transforming the way that they are seen by the customers, (Armstrong 2003) by engaging into healthy life style promotion, company wants to rich to new consumers. The traditional audience, the buyers of burgers and fries, seems to believe that the company products can make a part of good diet because the sales are of those products became to grow. The company has stable and reliable base of suppliers. Most of ingredients are sourced from British and Irish farmers. Company has long partnership programs which are guarantor of un-disrupted deliveries. The quality management systems are used to make sure that the food is highest quality. Starbuck’s UK has a Quality scout programme in place, which allows a customer to become an auditor on behalf of the company and to visit any of the UK suppliers. The findings are then published on the associated web site. Starbuck’s co-operates with other big brand names like Coca-Cola, Kraft Foods, and Nestle and can benefit from integrated marketing efforts. Larges UK competitor, targeting the same segments of the market, is Burger King. The new and growing threat in GB and Ireland is Subway. Subway is promoting their brand as healthy fast food and the number of restaurants is growing rapidly. In order to face that type of competition Starbuck’s is introduced new positions in their menu and invested large sums of money in image promotion. Starbuck’s operates as a franchise with just under the half of 1225 UK restaurants owned by the franchisers (Trimble 1990). The company is selling their food on site, over the counter and by drive thru facilities.



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Institution / College
University of Portsmouth
starbucks strategy




Title: Starbucks Strategy