S T A R B U C K S

Ashley Anderson
Arnold Carino
Joanna Louie
Quynh Nguyen
Pia Rodil
Michelle Tapia
Nathan Trujillo
Agenda

Company Background
o
Company History
o
Key Facts
o
Company Leadership
o
Products and Services
o
Mission Statement
o
Mission Statement Evaluation
o
Proposed Mission Statement

Internal Factors Evaluation

External Factors Evaluation

Company History
! 1971-Starbucks founded as single store in Seattles Pike
Place Market.
14
! 1982- Howard Schultz joins Starbucks as director of retail
operations and marketing.
14
! 1987- II Giornale acquires Starbucks assets and changes
name to Starbucks Corporation. Opens in Chicago and
Vancouver.
14
! 1992-Starbucks decertified the union and made IPO.
14
Quynh Nguyen
Company History
! 1993-Opens first roasting plant in Washington.
14
! 1996-Opens first stores outside of North America in
Japan and Singapore.
14
! 1998- Acquires Tazo, a tea company based in
Oregon.Lauches Starbucks.com.
14

! 2011- Changes its logo in honor of its 40th anniversary.
14
Quynh Nguyen
Key Facts
! Headquarter in Seattle, Washington.
3
! The average Starbucks customer visits the store six times
per month. The most loyal 20% of customers visit 16 times
per month.
3
! Offers more than 87,000 possible drink combinations.
3
! In 2013: >19,767 stores worldwide and 14.9 billion U.S.
dollars in total revenues, up 12% from the previous year.
Global store sales increased 7%.
19
Quynh Nguyen
Company Leadership

Howard Schultz

Chairman and CEO

4

Joined Starbucks in 1982

21

Not passionate about coffee

5
Pia Rodil
Products
Michelle Tapia
16
Services
Michelle Tapia

Servicescape
8

Wi-fi
16

Subscriptions
16

e-Gifts
16

My Starbucks reward
16
(Starbucks, 2014)
Mission Statement
Our mission: to inspire and nurture the human
spirit -- one person, one cup and one
neighborhood at a time.
15
Joanna Louie

Mission Statement Evaluation Matrix

Joanna Louie
Concern for employees NO
Concern for Public Image NO
Concern for Survival and Growth NO
Customers NO
Markets NO
Philosophy YES
Products and Services NO
Self-concept NO
Technology NO
Proposed Mission Statement
Joanna Louie
Joanna Louie
15
Joanna Louie
15
15
15
Joanna Louie
15
15
15
Joanna Louie
Proposed Mission Statement
Joanna Louie
Our mission: to inspire and nurture the human spirit one person, one cup and one
neighborhood at a time. Were passionate about ethically sourcing the finest coffee
beans, roasting them with great care, and improving the lives of people who grow them.
Were called partners, because its not just a job, its our passion. Together, we embrace
diversity to create a place where each of us can be ourselves. When we are fully
engaged, we connect with, laugh with, and uplift the lives of our customers even if just
for a few moments. When our customers feel this sense of belonging, our stores become
a haven, a break from the worries outside, a place where you can meet with friends.
Every store is part of a community, and we take our responsibility to be good neighbors
seriously. We understand what its like to be busy, so we make sure to position our
stores where you work, shop, travel, and dine. As technology continues to improve, so
do our stores and services. We strive to keep our stores as savvy and up-to-date as
possible to provide our customers with an attractive environment to meet, greet, or get
work done. We know that as we deliver in each of these areas, we enjoy the kind of
success that rewards our shareholders.
Proposed Mission Statement
Joanna Louie
Current Strategies
! Global Matrix
22
! Transnational
12
! Differentiation
20


Michelle Tapia
External Factors Evaluation (EFE)
Key External Factors
Weight Rating Score
Opportunities
Number of coffee consumers grew 5% in the last year
11
0.20 5 1
U.S. economy and job growth on the rise
9
0.12 3 0.36
Advances in technology leads to lower cost of operations 0.15 3 0.45
Threats
Chinese regulations (high import duties and tax rates)
9
0.25 1 0.25
Growing trend to be healthy
6
0.13 5 0.65
Climate change in farms where Starbucks get their coffee
17
0.15 5 .75
Total
1.00 3.46
Competitive Profile Matrix
Starbucks Starbucks McDonalds McDonalds Dunkin Donuts Dunkin Donuts
Critical Success
Factors
Weight Rate Score Rate Score Rate Score
Market Share
.3 5 1.5 3 .9 2 .6
Price
Competitiveness
.1 3 .3 3 .3 4 .4
Customer Service
.15 3 .45 4 .6 3 .45
Global Expansion
.15 5 .75 5 .75 3 .45
Quality of Product
.2 4 .8 2 .4 3 .6
Employee Benefits
.1 4 .04 2 .2 3 .3
Total
1.00 3.84 3.15 2.8
Arnold Carino & Joanna Louie
Michelle Tapia
Key Internal Factors
Weight Rating Score
Strengths
Strong Brand Name
4
.29 5 1.45
Sound Financial Records
10
.17 4 .68
Market Dominance
10
.20 4 .80
Weaknesses
Self-Cannibalization (Overexposure)
20
.08 1 .08
High Product Price
18
.10 3 .30
Increase In the Price Of Coffee Beans
20
.16 4 .64
Total
1.00 3.95
Internal Factors Evaluation (IFE)
Financial Analysis
Nathan Trujillo
Starbucks McDonalds Dunkin Donuts
Market Cap 53.90B 94.06B 5.47B
EPS .15 5.55 1.36
Net Income 116.80M 5.59B 146.90M
Gross Margin .57 .39 .78
P/Sales 3.53 3.35 7.78
PEG 1.40 1.98 1.82
P/E 462.99 17.12 37.79
ROE 2.33% 35.69% 38.39%
ROA 15.83% 14.78% 5.45%
S T A R B U C K S
Final Presentation
Ashley Anderson
Arnold Carino
Joanna Louie
Quynh Nguyen
Pia Rodil
Michelle Tapia
Nathan Trujillo
Agenda

IE Matrix

SWOT Matrix

Quantitative Strategic Planning Matrix

Final Recommended Strategy

Organizational Structure

Organizational Culture

Strategic Control and Reward Systems

Balanced Scorecard

Target Market

Product Positioning Map

External Factors Evaluation (EFE)
Key External Factors
Weight Rating Score
Opportunities
Number of coffee consumers grew 5% in the last year
11
0.20 5 1
U.S. economy and job growth on the rise
9
0.12 3 0.36
Advances in technology leads to lower cost of operations 0.15 3 0.45
Threats
Chinese regulations (high import duties and tax rates)
9
0.25 1 0.25
Growing trend to be healthy
6
0.13 5 0.65
Climate change in farms where Starbucks get their coffee
17
0.15 5 .75
Total
1.00 3.46
Key Internal Factors
Weight Rating Score
Strengths
Strong Brand Name
4
.29 5 1.45
Sound Financial Records
10
.17 4 .68
Market Dominance
10
.20 4 .80
Weaknesses
Self-Cannibalization (Overexposure)
20
.08 1 .08
High Product Price
18
.10 3 .30
Increase In the Price Of Coffee Beans
20
.16 4 .64
Total
1.00 3.95
Internal Factors Evaluation (IFE)
IE Matrix
Joanna Louie

Strengths - S
1. Brand Identity
10
2. Customer Base Loyalty
10
3. Variety
3
4. Market Dominance
10

Weaknesses - W
1. Self-Cannibalization
20

2. High Product Price
18
3. Perceived As A Substitute
20
4.Coffee Culture Clash
Opportunities - O
1. Customization
3
2. International Markets
4
3. Product Diversification
3
4. Technological advances lead to higher
profits.
SO
S1,O2
Embrace China through brand identity.
S4, O3
Diverse products can lead Starbucks to
succeed in other sectors such as the fast-food
industry
WO
W4,O1
Customize to the Chinese Culture
W3,O4
Use trending Apps to maintain customers by
offering promotions and coupons
Threats - T
1. Rising prices of coffee beans and dairy
products
17
2. Growing Trend To Be Healthy
6
3. Intense Competition
20
4. Saturated Markets in Developed
Economies
ST
S2, T1
Uphold the Starbucks Experience to increase
and maintain customer base loyalty despite
price increase.
S3, T2
Embrace the products that are healthier such
as the skinny alternative .
WT
W2, T3
Emphasis on quality.
W1,T4
First-Mover in China. Adjust to the tea
atmosphere.

SWOT
Matrix
Michelle Tapia
Arnold Carino
Quantitative Strategic
Planning Matrix
Nathan Trujillo
Final Recommended Strategies
Embrace China through brand equity
Implementing an effective hedging strategy, like future
contracts, to lock in low prices for high quality coffee
beans
More investments in advertising and marketing
initiatives in the face of increased competition in the
market.
Integrating Starbucks loyalty program with the mobile
application would also be recommended
Matrix Organizational Structure
Quynh
Quynh
Proposed Matrix Organizational Structure
Michelle Tapia
Diversity &Inclusion
23
People Orientated Culture
26
Eiffel Tower Culture
Employees are Partners
24

Starbucks Experience:Cafe Culture

1
Whats It Like To Work For
Starbucks?
Michelle Tapia

Guided Missile Culture

Open Mind

Respect & Dignity

Respect cultural differences

Strategic Control & Rewards System

Input Controls: Standard Operating Procedures

Output Controls: ROWEs

Starbucks Culture
&
Controls Improvement Proposal
Ashely Anderson
Strategic Control and Reward Systems
Internal Governance Mechanisms
! Guided Missile Culture
Input Controls
31
! Customer- focused (Behavior Guidelines)
31
" Employees are trained to act in specific ways
" Treat employees well and they will treat the customers well
" Happy employees lead to return customers
Output Controls
31
! Partner benefits (ROWEs; Intrinsic)
! Your Special Blend Package
Balanced Scorecard
Ashely Anderson
Pia Rodil
Young urban adults
! Core customers
26
! Ages 18-24 years old
26
! Average income: $55,000
27
! Third space
27
Current Target Market
Pia Rodil
Proposed Target Market
Global strategy: China
! urban Chinese upper middle class
! concentrated in the big cities
26
! 106,000 to 229,000 yuan ($17,000- $34,000)
27
! Ages 20 to 50 years old
26
! Aspirational appeal
28
Current Product Positioning
Pia Rodil

Proposed Product Positioning
Pia Rodil
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