STRATEGIC MANAGEMENT

STARBUCK
Hanny Purnama Sari ( 3104816 )
Ana!aia A" San!## ( 3114$01 )
Mar!%a ( )
INTERNATIONAL PROGRAM
FACULTY OF BUSINESS AND ECONOMICS
2010/2011
Starbucks Cofee Company: The Indian dilemma
SWOT Analysis
Strengths:
World n1 specialty cofee retailer
Every week: 40 000 000 customers
7600 retail location in the US
Star!ucks is not only cofee: it is an "lo!al e#perience with a
captivatin" atmosphere
$apid "rowth around the world
Serve hi"h%&uality cofee
Weaknesses:
lready postponed its intentions to enter 'ndia
(ro!lems with )apan *!rand ima"e afected and +ood did not
,t the -apan taste./
0i"h%+at products
Opportunities:
E#pansion 'n sia thanks to -oint%venture1 licensed or
company%owned operations
Economic re+orms in 'ndia included li!erali2ation o+ +orei"n
investment/
'ndia is the +ourth lar"est economy in the world in term o+
purchase%power parity
'ndia3s population is very youn"
4rowin" o+ middle%class
5006: 4overnment permitted 67' up to 819 in retail trade o+
sin"le%!rand products with prior "overnment approval
"reement si"ned with :ata to source premium cofee !eans
Threats:
0u"e competition in 'ndia *;ofee ca+< day.
0ard to ,nd a relia!le partner in 'ndia
=aturity o+ the cofee market in Europe
sia has a tea culture more than a cofee culture *Star!ucks
should educate this market a!out the &uality o+ cofee./
'nade&uate in+rastructure1 !ureaucracy1 re"ulatory and +orei"n
investment controls
7iferent taste all over 'ndia
;ofee is mainly consumed in the ur!an areas
'ndian lar"er producer o+ tea
7espite a lot o+ threats re"ardin" the 'ndian market1 Star!ucks
should enter this market/ 'ndeed1 the opportunities in the US and Europe
are very low due to the maturity o+ the cofee market/
Star!ucks does not really have the choice to enter this market i+ they still
want to e#pend their market share/ $e"ardin" the SW>: matri#1 the main
pro!lem that Star!uck will have to +ace will !e to competitive
environment/ 'ndeed1 a lot o+ other companies are implemented in 'ndia
such as ;;7 and ?arista/ ;ontrary to US1 Star!ucks will not !e the ,rst to
ofer a hi"h cofee &uality e#perience in the country they enter/
s a result1 'ndian market is a "reat opportunity +or Star!ucks !ut they
should work with a local partner i+ they want to make sure that they will ,t
the local taste and not reproducin" the same mistake as in )apan/ What3s
more1 !ecause 'ndia is not a cofee drinker3s country !ut they likely pre+er
tea1 Star!ucks will have to educate them to cofee and the hi"h &uality
cofee/ :he last pro!lem that Star!uck will have to +ace is that the country
has an e#tremely rapid "rowth !ut with hu"e the diference !etween
middle%class *that can aford Star!ucks. and rural population/
IFAS : Internal factors analysis
:he main internal stren"th o+ Star!ucks is undou!tedly his reputation/
'ndeed1 Star!ucks was one o+ the ,rst cofee retailers to settle in the US
and to develop all over the world/ s a result1 i+ we had to score Star!ucks
reputation his impact on his development1 we would pro!a!ly "ive them a
hi"h score/
:he second most important stren"th o+ Star!ucks is the atmosphere they
mana"ed to create in their shops/ 'ndeed1 Star!ucks not only sell cofee
!ut also propose a "lo!al e#perience to the customers/ ;ustomers that
come to Star!ucks do not only want to drink cofee !ut they want to see
and to !e seen/
:he last important stren"th is that Star!ucks only propose hi"h &uality
cofee to his customers/ :o achieve this1 Star!ucks developed partnerships
and ventures to deal with the !est cofee producers in the world *'ndonesia
and South merica mainly./
FAS : !ternal factors analysis
:he most important e#ternal +actors +or Star!ucks *and +or his
"rowth opportunities. is the increase in income +or sian and 'ndian
middle%class/ s a result1 Star!ucks wants to enter the 'ndian market
!ecause the middle%class is !ecomin" more and more important and the
population is one o+ the youn"er in the world/
:he second most important point is the li!erali2ation o+ the 'ndian
economy/ ?e+ore the "overnment decided to li!erali2e the +orei"n
investment1 a +orei"n company could hardly settle their !usiness in 'ndia/
:hanks to this chainman in economics rules1 Star!ucks will ,nally have the
opportunity to enter the 'ndian market/
$e"ardin" the 'ndian market1 the last important e#ternal +actor that
Star!ucks have to take into account !e+ore enterin" this market1 is the
competitive environment/ 'ndeed1 contrary to the other countries where
Star!ucks was perceived as a pioneer1 there are already a lot o+ shops
such as Star!ucks *;ofee ca+< day. that have a "ood reputation amon"
'ndian population/ :o succeed in this market1 Star!ucks should convince
the potential customers that drinkin" a cofee at Star!ucks is a uni&ue and
"lo!al e#perience/