LESSON

Starbucks A Success Story

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Starbucks represents something beyond a cup of coffee.

Howard Schultz

Discussion

What does Schultz mean by Starbucks represents something beyond a cup of coffee?
What were the principal drivers behind Starbucks success in the marketplace?
What does the Starbucks brand mean to consumers?
What are the major challenges facing Starbucks as it goes forward?
Describe Starbucks retail mix: location, merchandise assortment, pricing, advertising
and promotion, store design and visual merchandising, customer service, and personal
selling. How does its retail mix support its strategy?

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Idioms

coffee-table book

cry over spilled milk

wake up and smell the coffee

milk a duck

to be in hot water

test the water

Imentionedmyideatoacoupleoffriendsasawayofandtheywereveryenthusiasticaboutit.
Tourists are also advised not to flaunt valuable objects that might attract robbers, to be careful at
night, make sure they are with other people and to check nobody is following them. The guidelines
might sound extreme, but police officer Mario Leite says they are there to deal with realities on the
ground. .., he says. BBC
It is Indias best-loved brand of instant noodles, but now Nestles Maggi .
BBC May 31, 2015
Somebossesjustdenytheiremployeesarehaving problems,andtheydbetter...

He cant do that. That is harder than..

In 2010 Barbra Streisand published My Passion for Design, an ostentatiousfilled with photographs of her Malibu home.
New York Times Mar 16, 2015

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Reading | Starbucks around the world

Few companies in the food and drink industry have grown as widely and successfully as Starbucks. In just two decades,
Starbucks has grown from a small chain of U.S coffee shops into and international powerhouse. From Japan to England
to Mexico, Starbucks is now one of the worlds best-known brands, with thousands of shops around the world.
Whats the secret of their amazing success? Actually, both the history and concept of Starbucks are very simple. It
started in the 1970s as a small chain in Seattle, Washington, a crowded market with heavy competition. The owner,
Howard Schultz, was looking for a way to make his shops unique. So he took a trip to Italy, where he studied the style
and culture of Italian coffee shops.
Back in America, Schultz applied some of his findings. He made Starbucks shops more comfortable and sold a variety
of high-quality European and American drinks. The coffee culture he created turned out to be very popular. Starbucks
cafes became fun places to chat, read morning paper, or hold a business meeting.
Behind this simple idea is a strong business model and excellent marketing, and the companys sales and profit numbers are remarkable. Starbucks went public in 1992. Over the next decade, sales grew and average of 20 percent per
year, while profits grew an average of 30 percent per yearly. As the company expanded overseas in the mid-1990s, its
market share and profits continued to rise. Investors rewarded the stock by driving up the stock price.
Of course, every success produces competitors. Others coffee-shop chains have opened to try to capture some of the
lucrative market. Also, Starbucks already has a large number of coffee shops in the U.S. (more than 11,000 in 2008).
That means theyre running out of places to open shops domestically.
Regardless of these issues, Starbucks continues to grow and impress. Theres still plenty of room to expand overseas.
Also, riding the strength of their brand, they now sell bottled coffee drinks, ice cream, coffee beans, and other products. With so many revenue sources and ongoing expansion plans, the skys the limit for Starbucks.

Q&A | Comprehension questions

What is the main idea of the reading passage?
A. Starbucks sells delicious drinks.
B. With a simple concept, anyone can open a successful company.
C. Through good ideas and good management, Starbucks has become one of the worlds most successful brands.
D. Italian coffee culture is popular around the world.
When did Starbucks become a publicly traded company?
A. In the mid 1980s.
B. In the early 1990s.
C. In the late 1990s.
D. At the start of the 21st century.

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3.Profits at Starbucks ______________________.

A.Were highest in 1992.
B.Were 20 percent higher in 2002 than in the 1990s?
C.Grew more than 30 percent per year in the 1990s.
D.Grew at a higher percentage than sales in the 1990s.
4.What does theyre in the fifth paragraph mean?
A.Overseas companies.
B.Starbucks.
C.Starbucks competition.
D. U.S. coffee shops.
5. Which of the following is not true about Starbucks?
A. They sell own ice cream and bottled drinks.
B. They have many rivals trying to take market share.
C. Domestic shops were opened before international shops were opened.
D. Their stock doubled from 1992 to 1993.

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Pre-listening:
Match the words and its definitions

Other side of the tracks

Entrepreneurial

Surround

Bitter

Acquaintance

thepoorpartofatownorcity.

someone you know a little about, but theyre not

your best friend or anything.

marked by strong resentment or cynicism

something thats around you on all sides,

Its how you call someone willing to take financial

risks in new ventures

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Watch the video and decide whether the

sentences are true or false:

I dreamed big dreams

Howard dreamed the kind of dreams other people

said it wouldnt be possible
Howard didnt come from the other side of the
tracks

https://www.youtube.com/
watch?v=60S6L20AlbM

The entrepreneurial spirit is so alive and well in the

US
Howard advises us to let our dreams get away
from us
Grammar | Verb Tenses

(verb)+(ed) or irregular

Simple Past
Paste

Present

Future

The past simple is used to talk about a completed action that happened in the past.
It is formed using the past form of the verb. Most regular verbs end in -ed in the past simple. Mr.
Smith suddenly interrupted the meeting.
I finished the report last night. But many verbs are irregular.
Olivia went to visit the London branch yesterday. Simon got a promotion last month.
Questions and negative sentences are formed using the help verb did /didnt + infinitive. ? Did you
go to the company party at the weekend?+ Yes, I went to the party. No, I didnt (did not) go to
the party. I didnt feel well.
Look out for time signals. Theyll help you know when to use the tense. e.g. last night, yesterday,
two hours ago, five years ago...

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Grammar | Verb Tenses

Present Perfect
Paste

Present

Future

From Past to Present

We use the present perfect to talk about something that began in the past but is still happening
or unfinished:
Ive had too much to do lately. (I still have too much to do now!)There is always a connection
between the past and the present. This why the present perfect is known as the
bridge tense.It can be helpful to visualize a tense with the help of a timeline:
The present perfect is formed using the present tense of the verb to have: have/has and the
past participle of the main verb.
Most of the past participles of regular verbs end in -ed, but you should learn the irregular verbs!
A list of irregular verbs can be found in good learners dictionaries and in grammar books.
+ I have worked here for three years. I havent been on holiday for three years ? How long
have you worked here?
The present perfect is also used for:actions started in the past and are continuing now: Ive
lived here for four months.unfinished time period: Ive had two cups of coffee today. (todays not over!)life experiences (not important when): Ive been to New York twice. (in my life
so far until now) giving news: There has been an earthquake in Japan. (no time signal!)
The present perfect is used with an indefinite time signal: just, ever, already, never, yet, so far,
today, recently, this week, year, month.

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Complete the text with the correct forms of the verbs in parentheses.
Starbucks to start growing coffee in China, CEO says
Starbucks has not only helped popularize coffee in China, its also aiming to bring Chinese coffee to the
world.
Starbucks, for the first time in our 40-year history, is going to start growing coffee, CEO Howard
Schultz ____________ (say) while on a trip to Beijing.
Were going to actually plant trees and grow coffee in China, in the Yunnan Province.
The U.S.-based chain is making what Schultz calls a comprehensive strategic commitment to doing
business in China, in a way thats locally relevant.
Yunnan coffee is already known as some of the best in Asia, owing to the southern provinces fertile
soil, weather and water.
Starbucks is working with Yunnans provincial government to share our coffee knowledge, to help
Yunnan continue to develop into a top-quality coffee-growing region and bring the distinctive Yunnan
coffee taste to our customers around the world, Schultz said.
The chain will help develop and operate a farm and processing facilities in Yunnan, the company says,
and will also work with area farmers to boost their crops yield and quality.
We___________________________ (discover) a part of the area there that can produce the worlds
best coffee, the CEO said. And in three to four years, we will bring coffee from Yunnan to the world.
In a country full of tea drinkers, Starbucks is making good progress, Schultz said.
We______________ (be) here for 12 years now, with 400 stores in the mainland, 800 stores in greater
China, he said.
As far as whats driving business in China, Schultz said, Obviously, theres a tremendous size, in terms
of the inspirational middle class, the numbers of people who have access to disposable income. And
also theyre quite familiar with western brands. One of the things that __________________________
(surprise) us the most is how aware they ________________ (be) of Starbucks before we _________
(get) here.
And how fast they embrace change is another thing that _________________________ (really surprise) us.
People were drinking black coffee when we ______________ (get) here. Now they are drinking cafe
latte and cappuccinos and Frappuccinos, Schultz ______________ (say).
China is going to be the fastest-growing, biggest market for the future of Starbucks, outside of North
America, he ________________ (add).
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