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8/6/2019 Ashish - Starbucks
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StarbucksPresented by : Ashish Mittal
Roll No : BAN2010XMBA1P001Date : 13th July, 2011
ITM Executive Education Center, Bangalore
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Current Goals
Build an International Model Scale & Grow Profitably
Reach new customers with Seattles best Coffee
Optimize & grow US Retail Business
Elevate Partner Experience
Build World Class CPG Business
Accelerate in China ; CSR
Lead premium single cup category
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Presentation Outline
Introduction to Starbucks
Industry Overview
Company Overview
Site Analysis
Recommendations forImprovement
Focused Recommendation forImprovement
Final Action Plan Impact Analysis
Wrap Up
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Introduction to Starbucks
Company started in 1971 in Seattle,Washington
Grew from 55 stores in 1989 to over 2,200stores today
March 2011 marks Starbucks 40th
Anniversary Products sold include:
- beverages - pastries
- whole coffee beans - coffee-related retail items
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Industry Overview
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Industry Definition
Specialty Eatery Industry
Fits within the largest segment of disposable
income spending -- food and beverages
Steady growth in this segment in the 1990s has
led to an abundant number of new companies
As demand for convenience has made eatingout a normal routine, the demand for specialty
food services has increased in recent years
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Industry and Competitive
Analysis Market Structure
Monopolistic Competition
Competitive Activity Many companies are in the market and competition is fierce
Competitors use location, product mix, and store atmosphere
differentiation to establish market niche
I
ndustryC
osts andC
apital Structure Low to moderate costs for each location Major start-up expenditures are property and equipment
Major operating costs are labor and cost of sales
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Industry PEST Analysis
Political Influences Relationships between coffee producing nations and US
State &L
ocal government controls Economic Influences
Constant demand for food and beverages
Changes in disposable income could influence purchase levels
Social Influences Consumer preferences could shift from coffee to other beverages
Technological Influences Use of technology can improve operational efficiencies
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Company Overview
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Starbucks Corporate Strategy
Maximize market penetration
Provide a relaxing, attractive social
atmosphere
Offer high-quality products
Create a great working environmentAchieve profitability
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Starbucks SWOT Analysis
Strengths Largest market share in industry
Differentiated atmosphere
Weaknesses Aggressive expansion could lead to managerial / financial problems
Opportunities
Whole bean sales in supermarkets
Threats Lack of ownership of coffee farms can lead to price fluctuations
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Company Financial
Performance (2010 FY)
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Company Financial
Performance (2010 FY)
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Revenues Increased to a record of $10.7Billion
Operating Income increased by $857 Million to $1.4Billion
2010 Highest full year comparable sales growth
First ever dividend for shareholders
Offer special Cash Award to eligible partners inrecognition of their contribution to Starbucks strongperformance in 2010.
Quick Highlights
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http://moneycentral.msn.com/investor/invsub/results/state
mnt.aspx?symbol=SBUX
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Business Segments
The Frappuccinos
United States
Inernational
Global CPG
Seattles Best Coffee
Op Segment
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Retail Sales mix by product
type forCo operated stores
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Licensed stores by region:
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Performance Comparison
Graph
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MDA Fiscal 2011 View
Ahead
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Wrap-Up
Starbucks is the market leader in a growing
market segment
Starbucks is known world-wide for its high-quality food products and differentiated
Third Place atmosphere
The Wellesley location embodies the idealsof the corporate mission and has been very
profitable, but there are still opportunities
for improvement
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