Operational Tactics and Strategic Goals Presentation

Starbucks SWOT

Natasha R. Chalk

University of Phoenix

Starbucks SWOT

For this SWOT analysis, I chose to interview a manager at Starbucks, given my familiarity with the organization. The manager agreed that Starbucks had cultivated a strong brand image and consumers came in willing to regularly patronize the coffee establishment. There was a particularly high spike in traffic due to an interest in specialty beverages, such as the seasonal pumpkin spice latte. There is a concern that Starbucks' popularity may begin to diminish because competitors are providing similar premium coffee products. “Since 2010, Starbucks' global store count has risen 31% to 22,088 company-operated and licensed locations. The company has also consistently posted comparable sales growth while increasing its store count—something many growing chains fail to do” (Sun, 2015, par.3). However, at a certain point domestically, having increasing numbers of stores will not be supported by the market and it is essential that Starbucks can grow its international base with equal speed. From the manager's perspective, Starbucks is facing competition from the lower end of the coffee market. Although Starbucks promises to provide a home away from home in a more ambient setting than other coffee companies, many competitors are offering a more price-friendly and convenient option. Comment by Author: Deleted:e purposes of th Comment by Author: Deleted:du Comment by Author: Deleted: to the fa Comment by Author: Deleted:t th Comment by Author: Deleted:t Comment by Author: Deleted: clearly

Strengths

· The Starbucks organization has widespread recognition, which encourages consumers to patronize it because they know what they are getting when they go to a store.

· Starbucks has invested a great deal of training into its employees, to ensure consistency.

· Starbucks has created many unique beverages, such as the Frappuccino, that consumers cannot obtain elsewhere.

· Starbucks has a loyal workforce, in part due to the benefits it offers even part-time employees.

· Starbucks sells a popular selection of coffee beans and K-Cups, as well as bottled beverages.

· Starbucks products are available in stores and supermarkets. Comment by Author: Deleted:in

· Starbucks has tailored its international expansion to suit the needs of the foreign nations, altering the menu when necessary.

· Starbucks offers both sweet and savory beverages and foods and is expanding into the lunch market (Lutz 2013).

· Many of its delicious options are healthier than competitors' offerings, such as McDonald's and Dunkin Donuts. Comment by Author: Deleted:avory

· Although it is more expensive than its competitors, Starbucks is perceived as an affordable luxury and is an integral part of many consumer’s daily routines.

· Starbucks offers a personalized coffee experience, including the act of writing the consumer’s name on their coffee cup.

· Starbucks offers stores with an ambient setting that make it pleasant for workers and students to do work on their laptops or in groups and take advantage of free Wi-Fi.

Weaknesses

· Starbucks’ coffee has been criticized for tasting burnt and unpleasant.

· Starbucks does not provide a necessary product, and there are many potential alternatives.

· Some of Starbucks’ beverages have gotten negative press due to their perceived trendiness, such as the pumpkin spice latte.

· Not all nations into which Starbucks wishes to expand have a coffee culture.

· Competitors already offer a wide selection of popular hot sandwiches.

Opportunities

· Starbucks has a long history of successfully branching out into international markets. It is currently crafting a presence in India, China, and other developing world nations (Sun 2015).

· Starbucks has added drive-thrus, which will enable it to be more competitive with McDonald’s, Dunkin’ Doughnuts and other fast food chains which can offer more convenience than Starbucks is currently capable of doing.

Threats

· Dunkin' Donuts and McDonald's have entered the specialty coffee market and are offering lower prices than Starbucks. Comment by Author: Deleted:cheap

· The price of coffee continues to be unstable, which can make it difficult for Starbucks to remain competitive.

References

Lutz, A. (2013). Starbucks has four opportunities for growth. Business Insider. Retrieved from:

http://www.businessinsider.com/starbucks-four-opportunities-for-growth-2013-11

Sun, L. (2015). SWOT analysis: Starbucks. Retrieved from:

https://www.fool.com/investing/general/2015/06/19/swot-analysis-of-starbucks- corporation-sbux.aspx