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Read carefully Case No. 5 from your textbook, entitled "Starbucks Coffee Company," and answer the following questions briefly (1 mark each question):

1. Draw the SWOT matrix of the new Starbucks company.
2. Provide examples of the Corporate Social Responsibilities (CSR).
3. What is the competitive strategy used by this company? Justify.
4. Use the five forces of the M. Porter matrix to describe the Starbucks industry, particularly in Japan.
5. Describe the relationship of Starbucks with its primary stakeholders.
6. Describe the core competency of Starbucks company.
7. What kinds of strategic alliances are used by Starbucks in China?
8. What are the main challenges that this company faces in the Indian market?
9. Assess the competitive advantage of Starbucks in the global market.
10. Recommend solutions for Starbucks to improve its competitive advantage in both Japan and China.

Answer :

1. The SWOT Matrix of Starbucks is as follows:

Strengths: Strong brand image, global presence, customer loyalty.

Weaknesses: High prices, dependency on coffee beans, over-reliance on the U.S. market.

Opportunities: Expansion into emerging markets, diversification into new product lines.

Threats: Intense competition, economic downturns, changing consumer preferences.

2. Examples of Corporate Social Responsibilities (CSR):

Ethical sourcing of coffee beans.

Sustainable practices in store operations.

Community engagement through programs like Starbucks Foundation.

Employee welfare initiatives like healthcare benefits and education support.

3. Competitive Strategy:

Differentiation strategy: Starbucks differentiates itself through premium quality, unique customer experience, and innovative products.

4. Porter's Five Forces Analysis for Starbucks in Japan:

Threat of new entrants: Moderate due to brand loyalty but high due to the saturated coffee market.

Bargaining power of buyers: Moderate to high due to consumer sensitivity to price and availability of alternatives.

Bargaining power of suppliers: Moderate due to Starbucks' reliance on coffee bean suppliers.

Threat of substitutes: Moderate due to the availability of other beverage options.

Competitive rivalry: High due to the presence of other coffee chains and local cafes.

5. Relationship with Primary Stakeholders:

Customers: Providing quality products and experiences.

Employees: Offering fair wages, benefits, and growth opportunities.

Suppliers: Ensuring fair trade and sustainable sourcing practices.

Shareholders: Maximizing profits and long-term value.

6. Core Competency:

Expertise in coffee sourcing, roasting, and brewing.

Strong customer service and experience management.

Global brand recognition and marketing prowess.

7. Strategic Alliances in China:

Joint ventures with local partners for market knowledge and regulatory compliance.

Collaborations with tech companies for digital innovation and payment solutions.

8. Challenges in the Indian Market:

Cultural barriers and preferences for tea over coffee.

Intense competition from local cafes and international chains.

Adapting to local tastes while maintaining brand identity.

9. Competitive Advantage:

Strong brand equity and customer loyalty.

Global presence and economies of scale.

Innovation in product offerings and customer experience.

10. Recommendations for Improvement:

Japan: Introduce more localized products, expand presence in suburban areas.

China: Focus on digitalization and mobile ordering, expand partnerships with local tech companies.

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