Starbucks Case Study

Starbucks is one the most successful brands of our time. Starbucks reinvented coffee coincides with an increase in coffee drinking worldwide. it develops enthusiastically satisfied customers and contribute positively to the communities and their environment. Recognize the profitability is essential to the future success. Sartbucks chosen an unconventional marketing strategy that may be unique that will match the concept that the company wants to portray.

Issues

The issues that facing the company was its challenges to huge expansion and create new value

innovation. The need to extend might cause the company to be exposed and risk its

ability to change. However, Dunkin’ Donuts and McDonalds are now new players in the coffee field and pose big threats of competition.

Situational Analysis

External Environment

Porter’s 5 force Model

1- Threats of new entrants: McDonalds and Dunkin’ Donuts are the new competitor for Starbucks. Due to the low prices that the potential competitors provided, Starbucks will have disadvantage from that.

2- Threat of substitute products can creates a competitive environment. Since all companies are competing in term of quality, the substitute will last longer in the market if its quality was greater than the existing firm. The decision to buy a coffee from Macdonald or Dunkin’s Donuts is reasonable compared to Starbucks coffee.

3- Barging power of suppliers affects the strength of rivalry in an industry. It is better to have a mutual agreement between the supplier and the consumer. Force of the consumer bargaining power is proportional to the ability of buyers to force down the prices.

4- Rivalry among competing firms: Starbucks face