Business Analysis: Starbucks Assessment Answer

Answer :

Business Analysis: Starbucks

Company Background

Starbucks Corporation was established in 1985 and it is currently operating in more than 75 countries. This is an organization that was established and registered in the United States of America. It is estimated that the total number of stores owned by Starbucks is around 3000 all around the world. This organization is roaster, marketer, and retailer of coffee and over a period of time, it has become very popular among customers. One of the primary value proposition of this organization is the quality of coffee that is used by them (Hossain and Islam, 2015). In addition to that frequent innovation in product and services offered to customers is also an important factor that contributed to the success of this organization.

Stakeholder analysis

Stakeholder management register that will be useful for Starbucks is as follows-

PEST Analysis

Political factors- 

• It is important for a company to follow tax and employment legislatures. 
• The political factor of USA is stable and it will have a positive impact on business operations. 

Economic factors- 

• Factors that affecting business operations are-
• As the organisation is operating in different countries, the exchange rate in the stock market has a significant impact on overall profitability (Campbell and Helleloid, 2016). 
• Level of taxation in different countries is different which also affects profitability. 

Social factors- 

• Changing consumer preferences
• Level of education and standard of living
• Income generation capabilities of customer
• Change in work patterns of the customer

Technological factors

• Regular update in the technology used by the organization such as machinery used for roasting coffee is the most prominent technological factor affecting business operations (Campbell and Helleloid, 2016). 

Legal factors

• Strict custom and trade regulation. 
• Company has to follow all international regulations
• Company has to follow food and licencing regulations that differs in different companies.

Environmental factors

• Environment rules and regulation to mitigate negative environment impact. 
• Sustainability trend management
• International environmental protection policies and procedures.          

Competitive environment

Level of competition in the industry of roasting, marketing and retailing of coffee is very high in the United States of America. There are some business organizations that are in direct competition with the company such as a Costa Coffee. In addition to that the majority of fast food chains such as the Dunkin doughnuts Mcdonalds, KFC, etc. are also providing coffee at their stores which increases the level of competition (Van den Hurk, 2014). It can be said that the level of competition is very high and it is important to maintain quality at a competitive price. 

SWOT analysis

Strengths

• Brand image among customers is very high.
• Financial and other resources available has increased over a period of time.
• Supply chain management is effective due to a global presence (Van den Hurk, 2014). 

Weakness

• High prices charged by the organization.
• Products can be imitated by competitors easily.

Opportunities

• This industry is developing rapidly.
• The number of customers are increasing constantly.
• There is a scope of partnership with other organizations. 

Threats 

• The industry is highly competitive.
• No restriction on entering and exiting with this industry for new organizations. 
• Low-cost coffee are operating in the market (Hossain and Islam, 2015)