Starbuck's Case Study

Paper Summary:

This paper is a case study of Starbucks coffee shops. It provides details of the history of the company and continues through its growth and expansion overseas. In the conclusion, the author provides her advice as to how the company should go forward. Relative figures are included with the paper.

Outline:
History and Evolution of Starbucks
Key Events in the History of the Company
The Starbucks Model
The Key Issues and the Decision by Starbucks to go International
Some Negative Elements of Globalization Focused by Starbucks
Based on this analysis, my advice for Starbucks with respect to the next 3-5 year period

From the Paper:

"Seattle entrepreneurs Jerry Baldwin, Zev Siegl, Gordon Bowker founded Starbucks in 1971, locating their coffee importing business in Seattle's Pike Place market. The founders were content to grow the coffee importer to five stores in the metro Seattle area, and were gradually becoming known in the coffee industry, and as a result of these associations met Howard Schultz, who would eventually buy the chain and transform its business model. Mr. Schultz was passionate about introducing retailing concepts he had originally discovered during a trip to Milan, Italy and immediately after coming back from Italy, launched what would become the prototypical Starbucks stores, combining meetings places with good ambience for friends catching up with each other while enjoying a quality cup of coffee, calling these locations Giornale. As a result of the success of these stores Schultz purchased the Starbucks store chain in 1982 for $4M. As part of the retailing strategy Mr. Schultz began providing coffee to restaurants and espresso bars in the same year he purchased the company. Throughout the late 1980s Starbucks completed its first geographic expansions to Chicago and Vancouver, and also created its own catalog as well. Mr. Schultz has been known to focus on the socially responsible aspects of Starbucks since its founding and in 1991 initiated a relationship with CARE (an international humanitarian organization) and introduced CARE coffee sampler, and in 1992 Starbucks completed its IPO (initial public offering) on the NASDAQ National Market. The first half of the 1990s were years invested in the development of retail locations throughout the U.S. and the sale of music through retail storefronts in 1996, and also in the same year Starbucks opened locations in Japan, Hawaii, and Singapore. Within two years Starbucks launched stores in Taiwan, Thailand, New Zealand, and Malaysia, with Starbucks Coffee International in 1999 - 2000 timeframe launching new retail locations in China, Kuwait, Korea, and Lebanon. During this global expansion phase, Starbucks partners with Delek Group to open Starbucks retail locations throughout the Middle East including Israel. During the 2000 - 2003 timeframe global expansion continued with locations added in Paris, more retailing alliances formed globally and within the U.S. including Albertson's, and a more concentrated focus on acquisitions as well. The last three years of the company's history has included several acquisitions, joint ventures and alliances for entrance into foreign markets, and a series of research efforts to determine how best to enter the Indian market as well. In addition to the retailing strategy efforts, Starbucks has also moved into music recording with a joint venture with Concord Music Group to create the record label, Hear Music, which was announced in March, 2007. Hear is going to focus on internally known artists, with the first artist being Paul McCartney."

Sample of Sources Used:

• Patrick Burnson (2002, December). Amsterdam's key role in Starbucks' global strategy. World Trade, 15(12), 40-41. Retrieved December 7, 2007, from ABI/INFORM Global database. (Document ID: 241805271).
• Deutsche Bank (2006) - Starbucks Overview. Deutsche Bank Securities Research. New York, NY. 10 July 2006.
• Geoffrey A. Fowler (2003, July 14). Starbucks' Road to China; Prime Locations Are the Key, But So Is Using Snob Appeal To Lure Nation of Tea Drinkers. Wall Street Journal (Eastern Edition), p. B.1. Retrieved December 7, 2007, from ABI/INFORM Global database. (Document ID: 369860271).
• Jeffrey S Harrison, Eun-Young Chang, Carina Gauthier, Todd Joerchel, et al. (2005). Exporting a North American Concept to Asia: Starbucks in China. Cornell Hotel and Restaurant Administration Quarterly, 46(2), 275-283. Retrieved December 7, 2007, from ABI/INFORM Global database. (Document ID: 832085141).
• Stanley C Plog (2005). Starbucks: More than a Cup of Coffee. Cornell Hotel and Restaurant Administration Quarterly, 46(2), 284-287. Retrieved December 7, 2007, from ABI/INFORM Global database. (Document ID: 832085121).

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