Starbucks is the largest coffeehouse chain that originates from Seattle. Nowadays, the company has over 30,000 stores in 80 markets across the globe that employ over 300,000 people (“Starbucks company profile,” n.d.). Starbucks prides itself on the quality of its product, the attitude towards its customers, and the welcoming atmosphere of its establishments. This paper aims to provide an insight into the company’s strategic plan that led it to success and the potential it has on the market.
Every well-established company has a mission statement that aligns its long-term actions with a particular purpose. Gregory (2019) argues that the company “extends its warm and small company culture to its customers” to align the atmosphere within their establishments with the company’s mission statement. The way Starbucks contributes to the welfare and well-being of the population allowed the company to gain brand loyalty from many customers, which is proven to be a crucial factor for revenue increase (Kang & Namkung, 2017).
The analysis of the company provides a vital insight into its current achievements and future potential, as well as gives the reader an idea of the issues it might encounter. The initial advantages of the company that gave it a good headstart are the quality of coffee and employee attitude. Nowadays, the company also has a well-thought-out loyalty program and keeps innovating customer-oriented initiatives (Gupta, 2020). Currently, the company works towards optimizing its ability to adapt to the ever-changing preferences of its customers (“Starbucks announces strategic priorities and operational initiatives to accelerate growth and create long-term shareholder value,” 2018). Starbucks has a number of advantages that stem from the company’s success, such as brand popularity, extensive coverage of locations, consistent positive revenue, and the established supply chain. It has the potential to expand into other markets and expand its product lines, as well as provide additional support to online sales.
However, the market in which the company operates is easy to enter, and the products are not unique while having relatively high prices. Moreover, Campbell and Helleloid (2016) argue that the company was “not consistent with the image of corporate social responsibility that Starbucks was trying to convey to its stakeholders” in recent years (p. 19). Starbucks has lost a significant number of customers due to these issues. The current virus outbreak has weakened the position of Starbucks on the market due to the instability it introduced.
The financial state of the company prior to COVID-19 was seen as stable. The company’s tactics are consistently paying off, as its net sales continue to steadily grow annually, allowing the company to fulfill its plans for expansion and leave it enough room to introduce new products (Wiener-Bronner, 2019). The company’s previous achievements and its attractiveness for investments will keep Starbucks afloat throughout this challenging period.
Despite its apparent success, the company has a long to-do list that aims to bring Starbucks closer to being true to its mission statement. The adverse impact of the company’s dualistic attitude requires Starbucks to come out clean from the recent accusations and resolve all conflicts in the most positive way. Moreover, the company needs to take into account cultural preferences and show higher adaptability. Its current plan relies heavily on further expansion outside of the United States, as some of the markets, such as China and India, remain primarily undiscovered by major coffeemaking chains (“Starbucks announces strategic priorities and operational initiatives to accelerate growth and create long-term shareholder value,” 2018). In order to align its actions with its strategy, Starbucks has to become more flexible and adhere to customers’ demands.
Campbell, K., & Helleloid, D. (2016). Starbucks: Social responsibility and tax avoidance. Journal of Accounting Education, 37, 38-60. Web.
Gregory, L. (2019). Starbucks coffee’s mission statement & vision statement (An analysis). Panmore Institute. Web.
Gupta, S. K. (2020). Starbucks SWOT 2020 | SWOT analysis of Starbucks. Business Strategy Hub. Web.
Kang, J., & Namkung, Y. (2017). The effect of corporate social responsibility on brand equity and the moderating role of ethical consumerism: The case of Starbucks. Journal of Hospitality & Tourism Research, 42(7), 1130-1151. Web.
Starbucks announces strategic priorities and operational initiatives to accelerate growth and create long-term shareholder value. (2018). Starbucks Corporation – IR Home. Web.
Starbucks company profile. (n.d.). Starbucks Coffee Company. Web.
Wiener-Bronner, D. (2019). Every Starbucks growth strategy is working. CNN. Web.