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Answer :
Starbucks faced challenges implementing CAFE Practices, including consumer misperceptions about fair trade certification and operational challenges in international markets. To achieve its ethical sourcing goals and maintain brand standards, Starbucks initiated SFSI and navigated logistical complexities of expansion.
Starbucks faced several challenges as they implemented the Coffee and Farmer Equity (CAFE) Practices. One of the main challenges was the misconception among consumers that all Starbucks coffee was fair trade certified, whereas in reality only a small percentage was. The company's goal to ensure that all its coffee was ethically sourced by 2015 meant overcoming issues like the high cost of certification for small-scale farmers. The Small Farmer Sustainability Initiative (SFSI), with its $20 million loan program, was developed to assist farmers and promote responsible trade practices. There were also concerns about the integrity of the fair trade system and criticisms regarding inconsistencies and possible corruption.
Moreover, Starbucks had to address operational challenges in international markets, such as recruitment and training in China to maintain their brand standards. High operating costs, logistical complexities, and the need to adapt to local markets, as in Japan, required strategic partnerships and careful planning. As Starbucks expanded globally, maintaining product quality and uniformity of customer experience across different geographies became increasingly difficult.
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