Starbucks Company is one of the biggest coffee companies in America.The company was founded in the year 1971 in Seattle and currently hasoutlets in 23768 different locations around the world. The companydifferentiates itself from other businesses by the taste and qualityof their coffee and also the way they serve their customers leavingthem with an enjoyable experience. As other companies struggle toimprove their quality by giving customers handmade coffee, Starbucksstarted using espresso machines as they are more efficient and safeto use. Thus, Starbucks became one of the most successful companiesand continued growing and expanding its territory. Since thenStarbucks ownership and administration has changed, and currently,the president of the company aims at the distinctive Starbucksexperience in light of the current growth globally. Starbucks boastof being one of the best-governed organization and maintains theworking of the production processes by managing its distribution,direct communication with farmers to get the coffee beans and thenroasting its beans.
The corporation boasts of even having independent outlets all overthe world. Starbucks has used joint ventures on a few occasions whenentering a new market. It helps in better preparation and reductionof risks that come with trying a new market, and thus the bestcompany to do a joint venture with is a company that has experiencein the given market segment. An example of this joint ventures iswhen Starbucks merged with Tata Coffee in a strategy of introducingStarbucks to India. The company made a 50:50 venture with Tata Coffeethus leading to the creation of Tata Starbucks. Market segmentationshelps a company strategize how to enter e new market smoothly bystudying the market and being aware of all factors influencing it.Both internal and external factors play a significant role in thegrowth of a company. This strategy used by Starbucks have helped thecompany expand with a great rate around the world and even in Africawhere it has outlets in three different location.
Starbucks still has many expansion plans around the world, and it’salso working with various governments to help the farmers enhancetheir plantations and coffee growth and production. Despite themassive growth witnessed by the company, it is currently facing manyproblems in many different locations. The company is facing branchclosures in most places where its undergoing problems.one of thelargest difficulties the company faces in its expansion prospects isthe problem in adopting the culture of the particular area so as toknow how to strategize its entry into the market and how to relate tothe new consumers. The company is still continuing to close itsstores, rebrand others and trade others to local coffee businesses tocut losses. The company has also unbranded some its local outlets,and they currently operate as local coffee shops in an attempt tolearn what people love.
The company has created many partnerships with different businessesin an effort of expanding its territories and market share. Anexample is its partnership with Apple in selling music thus has anarea in iTunes called the Starbucks entertainment area.It`s a method of attracting Apple and MacBook users to their coffeestores. Starbucks has also merged with Kraft Foods in an effort ofselling Starbucks products to model grocery stalls. Later, though,Starbucks had an early termination of this partnership claiming thatcraft did not sell its product well and this led to a huge penalty onStarbucks. All these partnerships were an effort of popularizingtheir products and creating larger sales and some worked while othersdid not. Starbucks has undergone different market cycles and is stillthriving.It has also had many infringement cases mostly because ofother people using an imitation of its logo.
Starbucks vision emphasizes on maintaining principles as the companygrows and making the company the world’s finest coffee company. Thefirm has adequately adhered to its vision statement as it hasachieved all these qualifications set as standards. It`s missionstatement which emphasizes on empowering and nurturing the humanspirit and making sure that its outlet related to the “one person,one cup and one neighbor at a time “mission statement clause. Itmeans that the company plans on growing its business in differentparts each at a time. The mission and vision of the organizationexpress the purpose of the enterprise. The mission statement explainshow the company aims at providing service to its key stakeholdersi.e. customers, employees and also the shareholders (Oakland 2014).The mission statement also lists the values of the company and howemotionally prepared the company is in serving its purpose. Thus as aconclusion, it is clear that these components play a significant rolein the success of the firm. Some of this roles include communicationof the company’s purpose to stakeholders, making developmentstrategies and developing objectives and goals to help guide andmeasure the company’s success rate after a given period.
Globalization and technology are one of the most common factors thatinfluence the growth of a company. Starbucks globalization has helpedthe company maintain its status as one of the most globalizedcompanies in the market. It is crucial for a company to understandthe advantages of globalization so as to remain competitive in themarket and its impact on the production and effectiveness of theorganization. Globalization is the changes that occur to a givencompany about the market, communication structures, and transportfacilities to a different level than the one before. Globalizationhelps in enhancing the connections of a company with theinternational market and strengthening the relationships among thevarious stakeholders. A few factors push a company towardsglobalization (Lin & Wu 2014). Thus it includes dynamism indemand and other sectors in the economy, change in internationalregulations and location governance, advancement in technologies andthe interconnection of different cultures and traditions.
Advancement in technology has also helped cut many overhead coststhat affect the rate of returns of the company. As technologiesadvance, equipment produced is more user-friendly and highlyefficient in performing its duties. Use of technology in productionslessens the chances of errors occurring and thus saving the company alot of output costs.it also enhances the production at all times asthe dependence is more on the machines and equipment rather than theemployees. In relation with Starbucks, it’s clear that withglobalization and technologies advancement impacting the company, itis evident that some of its production chains i.e. sandwichproduction and coffee making are easier and more cost effective.Understanding of globalization helps Starbucks in coming up withpolicies that are culturally sensitive to suit the location and alsoassist in expanding the market internationally. Starbucks also usedthe word of mouth method of advertisement both in its home and globalmarket thus spending less in marketing and product promotion. Thecompany also employed the protection of its brand internationally andthe privacy of its business practices by use of the intellectualproperty laws.
The application of different organization based models in companiesplays a significant role in achieving above average returns oninvestments. The industrial based model relies on the adoption of anexternal perspective so as to be able to come up with goals andstrategies for the growth of the company.it has four majorassumptions which include the way the external forces influence thedecision making of a company and a few others. This model helps acompany come up with strategies and goals that enable the company tohave an above average turnover on its sales and market share. Thereis also the resource based model which explains how the uniqueness ofthe business and other resources and internal factors create a basisof getting high returns on investments and products offered toconsumers (Johanson & Mattsson 2015). The model shows that aparticular company has its unique resources to help in achievingsignificant returns. Starbucks can implement this two models, andwith its current global status, the company can end up achievingabove average returns. These models help a business in strategizingand planning before venturing into the particular market.
Stakeholder also affects the overall performance of the Starbuckscompanies in different ways. It entails people and also groups whichcontribute to the company’s operations. Many approaches show thatthe understanding and compliance with each stakeholder improves theperformance and success of the enterprise. Typical owners andinvestors participate in regular operations of the company and alsoin decisions making thus contribute to the overall performance of thebusiness. The customers and the community surrounding the businessalso play a prominent role in this the development of the industry.Starbucks relies on spreading information about its product throughword of mouth, and this requires good customer relations and alsogood relations with the community.as a conclusion it’s clear thatmany factors affect the growth and performance of a company.Nonetheless, properplanning and strategizing enables positive growth and also relationsthus leaving a good customer experience as its legacy. The StarbucksCompany has a lot to do so as to maintain its current market statusbut is still performing well currently.
Johanson, J., &Mattsson, L. G. (2015). Internationalization in industrial systems—anetwork approach. In Knowledge, Networks, and Power (pp.111-132). Palgrave Macmillan UK.
Lin, Y., &Wu, L. Y. (2014). Exploring the role of dynamic capabilities in arobust performance under the Rothaermel, F. T. (2015). Strategicmanagement. New York, NY: McGraw- Hill.
Oakland, J. S.(2014). Total quality management and operational excellence:text with cases. Routledge.
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