Starbucks International

Operations
 Company Overview
Starbucks started Of the 16,850 stores
1971 by Starbucks operates
Jerry Baldwin over 8,800 of them
Zev Siegl
and franchises and
licenses operate over
Gordon Bowker
8,000

Starbucks has Total net income in

more than 16,850 Sept. 2010 was 945.6
coffee shops in million up about
about 50 countries 241% from 2009
 The Problem
To increase international stores to
10,000 by 2005.
Where they successful or not ?
If they were successful did they use
their current market strategy ?
 No!
As of today, Starbucks International
operates only about 5,500 stores in
50 different countries.

Because of problems in the

international markets, it was hard for
Starbucks to use their market
strategy.
 Problems In the Market
July 2002 boycotts
of American goods International
by Arabs operations were
not as well planned
Japanese as US operations
operations
reported a loss of Performed badly in
3.9 million in May Europe and the
2003 Middle East in 2003
 Different Types of Risk Leading to
Starbucks Downfall
Strategic Risk Environment Risk
Focused too much Cups were not
on international recyclable
expansion rather Starbucks did not
than in house offer recyclable bins
Political Risk Coffee beans were
Boycotts of not certified
American goods because of
Operational Risk economical and
Lack of trained social conditions
workforce
 SWOT
Opportunities
Strengt Market penetration in
hs International countries
Co-branding with other food
manufactures
Whole bean sales in
supermarkets.
Convenient places
Rated top 100 companies to
work for in 2005
Location sizes
Weakne Lack of a trained workforce
ss Suitable real estate
Starbucks had no control over
operational cost
Lack of internal focus (too
much focus on expansion)
Threats
Look outside the US for
revenues and growth
In Asian markets,
Starbucks tried to attract
young people
In the Middle East,
Starbucks offered
segregated sections for
women
No smoking policy
Prices are higher
Slow expansion
Starbucks facing huge
resistance in international
countries over cultural and
political issues
Numbers of competitors
are increasing
Competency
Core Distinctive

Branded product
Catered to the needs Considered to be the
of diet conscious best place to work
young people because of its
Spent less than 1% on employee friendly
advertising and policies
marketing
 Products Starbucks Offer
Coffee
Tea
Mugs
Music
Books
Stuffed animals
Coffee makers
Cookies
Pastries
 Key Success
Since 1996, Starbucks has been in the international
market. They have not had real success overseas like
they expected in the US
In 2002, Starbucks announced to increase its stores
to 10,000 by 2005
In 2003, they announced they would slow down
expansion
By closing down underperforming stores in 2008-
2009 Starbucks was able to increase total net income
by 241%.
In 2009 total net income was only 390.8 million and
2010 was 945.6 million.