Organisation name: Starbucks

Student ID: DBS15095

Name: Chew Jen Qin
Subject: Business Organisation
Lecturer name: Ms. Teoh Ming Fang

Task 1
1.1 Analyse how the organisations visions,missions,objectives,goals and core competencies
are related to their strategic planning

Starbucks mission: The mission of Starbucks is to establish Starbucks as the premier

purveyor of the finest coffee in the world while maintaining our uncompromising principles
while we grow. (Starbuckscoffee.ru, 2015)
The mission of Starbucks is to be the best seller of the finest coffee while maintaining its
principles. Through that mission, Starbucks is providing a good working environment with
treating others with respect and dignity. Starbucks is embracing diversity as an essential
component in the way they do their business and they apply the highest standard of
excellence from sourcing and purchasing the finest coffee beans to roasting the beans with
great care and delivery. Starbucks plan to have satisfied customers all of the time by fully
engaging and connecting to uplift the lives of customers. Starbucks contributes to our
communities and environment by organising various community services, reducing the size
of their napkins and garbage bags which lightened their solid waste by about 816.5 tons in the
year 2004 , providing recycling services and 10% post-consumer recycled paper fiber for
their cups in North America, 50% post-consumer recycled PET (rPET)in the cold cups used
in the European market and 15% rPET in bistro boxes in the US. Starbucks also promotes the
use of reusable tumblers in their stores by giving the customers a discount when using
them .This is to reduce paper and plastic waste created by the company and last but not least,
Starbucks recognises that profitability is essential to their future success.(Starbucks Coffee
Company, 2015);(Wikipedia, 2015)

Starbucks vision: To inspire and nurture the human spirit one person, one cup and one
neighbourhood at a time.
The Starbucks vision helps to increase the productivity of its employees as it motivates
and empowers by giving its customers a good cup of coffee that can really make their
day. The vision of the company helps the organisation set goals to advance and take one

step closer for a vision to become a reality by the means of expansion and providing an
ease of availability throughout each neighbourhood. (Page, 2011)

Objectives:
Main Objective: Our objective is to maintain Starbucks standing as one of the most
recognized and respected brands in the world.
Starbuckss objective is vital for their business because without it, the company will
simply lack direction and purpose as its objectives aid the company into the process of
decision making where they can keep track of their company and create their strategies
accordingly to achieve outline goals. Starbucks is providing customers with their highest
standard of service, finest coffee beans and through that they create customer loyalty and
increase their mass market reach to become an internationally respected company.
(Starbucks Fiscal 2013, 2014)

Goals:
- Becoming the leading retailer and brand of coffee in each of our target markets by
selling the finest quality of coffee and related products providing each customer with a
unique experience.
- Refocus on the consumer experience in stores and our position as a third place between
home and a workplace for human connection. This is done by giving the customers good

service by providing Wifi in stores and creating personalisation by writing the customers
name on their respective cups.
- Achieve sustainable growth in established international markets while at the same time
investing in emerging markets such as China, Brazil and Russia.
- Focus on relevant information and profitable growth opportunities through the offerings
of new products and platforms to reduce the supply chain risk of coffee beans(WB, 2012)
- Continue to be known as a corporate leader in social responsibility by creating
opportunities and employment for youths,community service,and creating a platform
called Starbucks RED to help finance HIV/AIDS prevention. (Starbucks Coffee
Company, n.d.)

Core competencies:
The core competencies of Starbucks has been its ability to effectively leverage their
cornerstone product differentiation strategies by offering a premium product mix of high
quality beverages and snacks. Starbucks brand is built on selling the finest quality coffee
to provide customers with the Starbucks Experience, which reflects the culture of
communities in which they operate therefore, builds a high degree of customer loyalty
with a cult following. Its human resource management values build a strong internal and
external relationship with suppliers which drives the success from an organic expansion
into an international markets, horizontal integration through smart acquisitions and
alliances that obtains their objective into being the most recognised and respected brands
in the world.
3

Understanding core competencies help the organisation to create a strategic business plan
as it helps the organisation understand its own companys strengths that differentiate
them from other companies and can use those strengths to their advantage to improve
their company as a whole. (Geereddy, 2014)

1.2 Evaluate recent plan/ event / marketing activity undertaken by the business, Next, analyse
the factors using PESTLE concept (Political, Economic, Social, Technological, Legal and
Environmental)

Starbucks has made some moves to tackle the emerging mobile computing revolution by
tying up with Apple to introduce discounted coupons in their mobile applications. This
exercise has been accompanied by co-branding and cross selling to be well placed and
able to reap its benefits of the smartphone revolution. Having said that, Starbucks has
recently launched a mobile app for iPhones and Android which would be the quickest
and easiest way to pay for your coffee, it is cashless and it features a personal dashboard,
you can pay for your order, check your balance and add money to your Starbucks Card
(with debit/credit card ,paypal or Apple pay), track rewards that you have earned, get free
songs, apps and more from Pick of the Week , you will be able to browse popular menu

items as well as send gift cards to friends. This is to ensure that Starbucks is still the latest
trend in the US. Starbucks started beta testing their product in the year 2009 which could
access the prepaid funds to purchase products. On 11 January 2011, Starbucks released
the full mobile platform. The Starbucks app is also Apple Watch compatible. (Starbucks
Coffee Company, 2015);(Wikipedia, 2015)

Political Factor
-

Sourcing raw materials has been a main political factor in Starbucks. This is

because of the concerns that attracted the attention of the politicians in the west and in
the countries from where it sources its raw materials. This is why Starbucks is keen on
adhering to social and environmental norms. The sourcing strategies that are followed
are appropriate and it gives importance to the fair trade practices that has been agreed
upon by global corporations and governments developing in the developed countries.
This factor is related to the plan as the sourcing of raw materials can affect the
business in Starbucks if it is not properly taken care of. If the sourcing of raw
materials is not done properly, the image of Starbucks might be tarnished as its aim is
to have the finest coffee in the world and that in turn will affect the business of
Starbucks which will lead customers to not downloading the application.
-

The other political factor is that Starbucks needs to follow the rules and

regulations in the respective countries in which they source their materials. This is
necessary to avoid activism and political issues in the developing countries. As stated

earlier, if any scandal is to occur, the name of Starbucks will be smeared and the sales
of the company would drop.
-

Starbucks faces regulatory pressures within its home market which is in the

United States because of the scrutiny of the business processes that multinationals
based in the US are now subjected to.
-

The International coffee agreement sets a limit of coffee exportation could

have a major influence on Starbucks operations. The price fluctuation and instability
from coffee producing companies also affect the Starbucks buying behaviour and
production. (Managementstudyguide.com, n.d.);(Makos, 2015)

Economic Factor
-

Inflation rates in countries which Starbucks operates often reduces the buying

power of the people in their respective countries. The economic recession in their
specific countries will force the people to set their spending priorities and this lowers
the spending power in Starbucks as well as the use of their mobile app.
-

The globalisation of the coffee market means that coffee bean farmers earn

less. This means that very few people would want to do it for a living which affect the
amount of coffee produced and will result in a limited supply for Starbucks.(Heavey,
2010)
-

Starbucks are affected by the exchange rates when trading internationally.This

is when the currency of the country supplying coffee drops, Starbucks will be able to
get more for their dollar when importing the goods.The savings can be passed along
to their customer or Starbucks will get a higher margin of profits. (Heavey, 2010)

Socio-Cultural Factor

Population demographics are a very important factor for Starbucks as they

identify what parts of the population they need to aim their product on or which parts
of the population that visits their stores more .Case study shows that the percentage of
the age groups that drink coffee or speciality coffee are men and women at age 25 to
40 as they account for 49 percent of their business who tend to be urbanites earning a
relatively high income and young adults age 18 to 24 which contribute 40 percent of
their business. (O'Farrell, 2015);(Heavey, 2010) Starbucks appeals to this consumer
directly through introducing technology as soon as it comes available, focusing on
social networking and actively cultivating a cool image. The young adult audience
grows 4.6 percent each year. (Managementstudyguide.com, n.d.);(Makos, 2015)

Consumers in the United States are increasingly turning Ethical Chic which

means that the products they buy and the brands they consume need to prove that they
are following social and environmental norms in their manufacture
-

Customer awareness for the social and environmental costs have been

increasing for the consumers of Starbucks in the US. This is why Starbucks have to be
globally responsible.
- Starbucks might have to change their aim from young adults as research shows
that the average age of the population is increasing and the birth rates are becoming
more stagnant. Therefore in the long run, the market population of the target market
for Starbucks will significantly lessen.
-

The average wage of a worker in the US has been increasing since the year

2009, the increase of wages would indirectly mean extra money to spend on their
daily life items such as coffee.(Ssa.gov, 2014)
Technological Factor
-

Starbucks has introduced internet WiFi capabilities in its outlets so that

customers can do their work while enjoying a cup of coffee.This is a very important

factor as the companys target group is for young adults and career driven men and
women who value time and technology.
-

Smartphone is the new technology that we cannot live without today. In 2009,

there were 305.3 million subscribers and 461.6 million users in the year 2010 to the
smartphone and has been spectacularly increasing during the years. Which has created
an opportunity for Starbucks to create their mobile app to reach out to more customers
and increase the convenience of the customers by technology.(Statista, 2015)

Legal Factor
-

Starbucks has to adhere to their privacy policy for the Starbucks mobile app,

the information that you give to them is disclosed by the company and it is only given
to others out of their organisation when you give them consent to do it.(Starbucks
Coffee Company, 2015)
-

Starbucks must ensure that they do not violate any laws and regulations in the

United States or the laws in each respective country that Starbucks is doing their
business .
-

Starbucks has implemented terms and conditions for their Starbucks Loyalty

Program as to avoid liability.(Starbucks Coffee Company, 2015)

Environmental Factor
-

Starbucks coffee supply has been threatened by climate change. The company

faces the effects of climate where hurricanes and more resistant bugs are reducing
their crop yield. This factor can affect the Starbucks supply chain where the company
may have to decrease profit margins due to the price sensitivity of customers.
(Goldenberg, 2011)(PEST Factor (Environmental), 2014)
8

Starbucks has to adhere to the environmental laws in which the company is

sourcing its raw materials from to avoid any legal action taken upon them.
(Managementstudyguide.com, n.d.);(Makos, 2015)

Conclusion
The analysis proves that Starbucks has been operating in a relatively stable external
environment. Starbucks should not have any political or legal issue as it would result
to the loss of brand power and the use of the mobile application as sales might drop
from the loss of integrity of the company.Consumers nowadays are more aware of the
environment which strives the company to be more environmentally friendly.
Starbucks has been using the social media to campaign and promote their coffee for
people to spread the word about Starbucks which brought huge success for the
company and the brand became the latest trend . (Moth, 2014) Therefore to stay as the
latest trend, Starbucks has further improved themselves by creating the mobile app for
convenience of the customers to achieve the Starbucks Experience. As well as
adapting and using the technological advancement for the companys profit by
targeting specific groups of people. (Managementstudyguide.com, n.d.);(Makos,
2015)

1.3 Assess the effectiveness of the related plan / event / marketing activity identified in task
1.2
Smartphone is the new technology that we cannot live without today. Starbucks digital
strategy is important in order to attract and engage Millennials, which are people born in the
1980s to the 2000s. Starbucks claims that their mobile app provides convenience and a better
consumer experience. This would eventually help to increase ticket and traffic, ticket being
the average check paid by the customer. In 2009, Starbucks launched its app in 16 stores, and
when Starbucks released the full platform for its mobile app in 2011 which allowed the
customer to pay with their mobile device, The application was used 3 million times in the
first 9 weeks and in comparison with the 9 week period starting in October, 6 million
transactions demonstrating the leap in customer use and adoption. Within the mobile app,
customers have access to features that allow them to manage their Starbucks card , reloading
and checking their balance through their smartphone devices.The Starbucks eGift was added
as a feature in June and by October, the sales have doubled to account for 10 percent of the
eGift sales, the eGift is a digitally customised Starbucks card that can be uploaded to your
mobile app. According to Starbucks, the company had 5 million mobile transactions per week
in 2014. (Starbucks Newsroom, 2011)

10

(Starbucks, 2014)
In the two charts above , there is a breakup of the US retail revenue by mode of payments for
4Q14. 6% of the revenue that comes from unregistered cards means that the customer refills
the card to pay for purchases at Starbucks. 12% of the revenues come from My Starbucks
Rewards card which are registered on the website. 15% of the revenues come from the
mobile which means that customers use the mobile application to make payments at the
checkout counter which contributed revenues of 1.5 billion in the fiscal year of 2014. The
remaining 67% of the revenue comes from other modes of payments for example, cash or
bank cards.(Jones, 2014)

11

(Statista, 2015)
The Starbucks mobile app has been being increasingly used as a tool of convenience,
according to the chart above. In the year 2013, 90 percent 1.6 billion of money that was spent
on mobiles by Americans(Shah, 2015). In the first quarter of 2014, about 10 million
customers pay through the mobile app and has an average of 5.5 million transactions per
week (www.mobilepaymentstoday.com, 2014). In 2015, mobile transactions represented 16%
of the companys total in the first quarter of 2015 with an average of 8 million transactions
per week. Today, there are about 13 million customers using the mobile app. (Jones, 2015)

Task 2

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2.1 Perform a Strengths, Weaknesses, Opportunities, Threats (SWOT) Analysis for the
organisation
Strengths
-

The main strength of Starbucks lies in its strong financial performance that has

allowed it to remain in the number 1 spot among coffee retailers around the world and
has always had a stable top to bottom line record growth. From the year 2010 to 2014,
the java house revenue rose by 53% and earnings per share had more than doubled.
The company has predicted that revenue will rise from 16% to 18% this year
compared to the 11% top line growth in 2014. Starbucks recently took control of
Starbucks Japan, which should boost its top line this year with 1 billion dollars in
incremental revenue.
-

The company is valued at more than 4 billion dollars that is considered to be a

significant strength when compared to its competitors. Last quarter, Starbucks

comparable sales rose 7% annually with a 7% growth in America, 12% in the
China/Asia pacific region, and 2% growth in the Europe, Middle East and African
region. McDonald's and Dunkin Donuts sales growth are unable to even compare to
the numbers that Starbucks produce, making it no contest. . In the same last quarter,
McDonalds sales have slipped 2.3% annually and Dunkin Donuts reported 2.7% US
comparable growth and 1.7% comparable global growth.
-

Starbucks has a good brand power which symbolises excellence, quality at an

affordable rate and an excellent mind recall amongst consumers as the company
enjoys its dominant position in the worldwide market for coffee and beverages.

The company is the largest coffee house in the world. It is because of its size

and high volumes that they can afford to price its products at premium and middle tier
range to attract more consumers. Since 2010, Starbucks global store count has risen to
31% that is 22,088 company operated and licensed locations. The company also

13

consistently posted comparable sales growth while expanding its store count which is
difficult for many growing chains to do.
-

The company is known to pioneer people management industry where people

skills and soft skills are vital to the companys success which means that Starbucks
has actualised a positive workspace for its employees which translates into happier
associates while serving the customers in a superior way leading to an all round
benefit for the company. (Sun,2015)
Weaknesses
-

The company depends heavily on its main and key input, which is the coffee

beans. The price of the coffee beans will then determine the price of the coffee and of
its profitability. This means that Starbucks is too dependent on the price of coffee
beans and must diversify their product range to lessen the risk of their dependence.
-

In recent times, the company has come under fire for its procurement practices

with many environmental and social activists which are looking into the unethical
procurement practices when sourcing for their coffee beans from impoverished third
world farmers. The company has also been accused of violating the fair coffee trade
principles which were set to overcome this problem.
-

Starbucks products are priced outside the budgets of many working-class

consumers, causing a large amount of their consumers to opt for cheaper alternative
outlets such as McDonalds, Burger King, and so on.

The Starbucks product range is small as compared to McDonalds or Burger

King which is rapidly growing as the compressed schedules of customers who would
like to eat and drink something instead of making it at home.
-

The small range of products available at Starbucks is inconvenient to majority

of the target consumers which choose outlets which provide a large selection of full
meals or quick bites

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Starbucks has a weak international growth. The American and China/Asia

Pacific regions are faring well, but the European, Middle East, and African countries
may weaken further due to economic troubles in the mentioned regions. The
comparable store sales rose in the EMEA( Europe, Middle East and Africa) region in
the last quarter, but revenue declined to 10% year over year as foreign currency
impacts and shifts towards licensed stores.
Opportunities
-

The company has an opportunity to expand the range and quantity of suppliers

in order to diversify its sources of input as to not be too heavily affected by a single
supplier. This would help the company avoid fluctuating coffee bean prices and thus
more resilient against supply chain risks
-

The company has an opportunity to expand into emerging markets in China or

India, where the number of available outlets providing a quick coffee and breakfast is
insufficient (Forbes.com, 2015). The company can expand further within these
countries instead of oversaturating the US market which has a lower demand due to
the high amount of Starbucks outlets within each state.

Starbucks has the opportunity to expand its product offerings to provide a full

spectrum of food and beverages like the McDonalds and Burger King to
accommodate the customers of today who would like to eat and drink at the same
time to save time for other tasks.
Threats
-

The rising price of coffee beans are part of the supply chain risks that the

company is subjected to, which would affect its profitability. Furthermore, the
increase of dairy products in the industry will affect the company which will also be a
threaten teh companys profitability, especially when the prices fluctuate.

15

The company is threatened with trademark and copyright infringements from

lesser known rivals who wish to freeload on its success. Starbucks has fought
litigation by others that are misusing their logo and brand.
- Intense competition are faced by the company due to the loyal clientele of the
local and specialty stores around Starbucks outlets.
- Starbucks is facing significant threats such as disruptions in the supply chain
because of global or local conditions. The unstable price of coffee is defined as the
price per kilogram of the more expensive Arabica beans and the cheaper Robusta
beans. Starbucks,McDonald's and Dunkin Donuts typically buy Arabica beans while
Robusta beans are mainly used in supermarkets and instant coffee. .
- Starbucks has to expand into emerging markets as the developed markets that
they have relied on are saturated and the fact that the ongoing recession has made
tough for many retailers, it faces significant threats from this aspect.
- Starbucks has locked in nearly 70% of its coffee supply to the year 2016.This
only happens when Starbucks anticipates rising coffee prices. If coffee prices fall
below the Starbucks locked-in price, money is lost on that assumption.

The rising competition from Dunkin Donuts is another threat as it plans to

open 200 new stores in California over the next five years as well as 1400 stores in
China by joint venture over the next two decades. (Managementstudyguide.com,
2015)

Conclusion
Starbucks might experience losses due to the soft sales in Europe, the danger of currency
rates and unstable coffee prices. But the companys impressive ability to increase its revenue,
earnings, store count, and comparable sales would easily outweigh the other weaknesses and
threats (Managementstudyguide.com, n.d.)

16

2.2 Carry out an environmental audit using Porter 5 forces analysis for the organisation
Threat of New Entrants: Moderate
There is a moderate threat of new entrants to the industry because the barriers to entry is not
high enough to discourage new competitors to enter the market. The industrys saturation is
high due to Starbucks by over saturating the market with stores. For the new entrants, initial
startup investment may not be a significant amount as they can lease stores and equipment. It
is relatively easy to enter the coffee market but it is usually faced with the bigger brands like
Starbucks who have acheived their economies of sales by lowering the cost of the product.It
is moderately difficult for new entrants to differentiate themselves from product quality and
its prime locations from Starbucks. The company has a larger scale and scope, which makes
them easier to gain favourable access to raw materials with the relationships they build with
suppliers.Therefore, the expected retaliation from bigger companies for resources,locations
and price competition for new entrants is moderately high which creates a moderate barrier of
entry
Threat of Substitutes: High

17

There are many substitutes for coffee, some of which are tea, water, fruit juices and
sodas.Bars and pubs could also provide the social experience that can be obtained by
Starbucks.Consumers could also make their own coffee with their own coffee machines
instead from buying from retailers as it would cost less.There are no switching costs for the
consumers for switching to substitutes, which makes the threat high.Therefore, Starbucks is
trying to overcome this threat by selling coffee makers and premium coffee packs in grocery
stores.

Bargaining Power of Buyers: Moderate to Low Pressure

The bargaining power of buyers is low because there are many types of different buyers in
this industry and they are not able to demand price concession. It offers vertically
differentiated products with a diverse consumer base which will make relatively low volume
purchases which decreases the buyers power. There are no switching costs with the high
availability of substitute products so Starbucks prices its product mix in relation to rivals
stores with competitive premium pricing.Buyers have a moderate sensitivity in premium
coffee pricing as they pay more for the product quality but are still watchful if the price is too
costly.

Bargaining Power of Suppliers: Low to Moderate Pressure

The main input into Starbucks are its coffee beans and Arabica coffee that is grown in
selective regions which make the cost of switching between suppliers are moderately
low.Starbuck has the power to take advantage of its suppliers but it maintains its fair trade
practices under its coffee and farmer equity (C.A.F.E) program which gives its suppers fair

18

partnership status.The suppliers of the coffee industry poses a low threat in competing againts
Starbucks via forward vertical integration which lowers their power.Therefore due to the
companys size, Starbucks forms a highly important role in their suppliers business. Given
these factors, the suppliers pose a low bargaining power.

Intensity of Competitive Rivalry: High to Moderate

The industry has a monopolistic competition. Although Starbucks has the largest market
share, its close competitors also has a significant market share which creates a significant
amount of pressure towards Starbucks. Starbucks maintains some competitive advantage as it
differentiates its product with premium coffee and services which causes a moderate intensity
for competition.The coffee industry is mature and the growth rate is moderately
low.Therefore, the competition between the companies is high due to companies that seek to
increase market share from established companies like Starbucks.All these factors contribute
to the level of competition among rivals to be moderately high.

Conclusion
Looking at the Porters five forces, we can conclude that we can get an aggregate industry
(Geereddy, 2014)

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2.3 Complete a stakeholder analysis which covers not limited to employees, customers,
shareholders, suppliers & etc
Customers
To catch the customer's nature of interest, they must feel like they receive a fair exchange in
the value or quality for their money that is spent for that item. Customers would also like to
receive safe and reliable products. In Starbucks case, customers would like to have ethically
sourced premium arabica coffee beans which are carefully roasted and the beans are obtained
through fair trade and are organic.Customers undoubtedly have a nature of power as they
purchase goods from competitors and have a choice of boycotting companies whose products
or services are unsatisfactory and unacceptable.Therefore, Starbucks has planned to fully
engage customers to connect and uplift their customers as one of their principles of the
company. Good customer service gives a sense of belonging to the customer and therefore
creating a third place between the house and the workplace. Starbucks also has low calorie
options and reduced fat breads and pastries as a commitment to wellness through healthy
food. Gift cards,coffee beans, brewing equipment, Starbucks cups,mugs and other
merchandise with the Starbucks and other gift items are added value through additional
products increasing the level of Starbucks experience for customers.Furthermore, Customer
loyalty is achieved through the quality of coffee, the friendly employees from the stores, a
good location that has easy access and above all, good customer service.
Employees
To attract future employees nature of interest, the company must have a stable employment in
the firm.The employees must receive fair pay for the work done for the company in

20

comparison with other competitors and the place of work must be a safe and comfortable
environment. The nature of power given to the employees are the union bargaining power,
strikes against the company for fair gain, and the publicity of the company is brought upon its
employees as they represent the company by wearing their uniform, therefore any bad actions
taken by the employees will damage the image of the company. .Coffee shop employee
loyalty can be gained by treating the employees with respect.Employees should receive good
pay and benefits from their company such as staff discount on their products.Starbucks
should provide a safe and friendly environment for the employees as well. One of Starbucks
principle is to provide a good working environment with treating others with respect and
dignity as their employees are called partners.Starbucks employee benefit package is having a
base salary with healthcare benefits, stock options and employee training for career
development such as Coffee Master Program,Servant Leadership Workshop and star
skills.Last but not least, employees would only work long term with the company if they see
a career growth opportunity.
Stockholders
Stockholders nature of interest can be obtained by receiving a satisfactory amount of return
on dividends from their investments.Shareholders are committed to enjoying the kind of
success that rewards them. This will help the stockholders realise the appreciation in stock
value of the company over time. The stockholders nature of power is upon the right of the
stockholder to exercise voting rights based on the share ownership.The stockholder also has
the power to inspect the companys books and records to keep track on how the company is
doing.Starbucks allows current stockholder and new investors to purchase an sell shares of
Starbucks common stock by having a buy direct plan.Stockholder loyalty is achieved through
generated profits from the company, constant or increased pay in their dividends from their
investments, strong code of ethics and a social responsibility that is held by the company to
coffee farmers and the environment.
Suppliers
The interest of a variety of suppliers can be attracted through receiving regular orders for
goods and the efficiency of the company to pay the suppliers from the goods delivered.The
nature of power obtained through being a supplier is from selling goods to the competitors
and boycotting companies whose policies are unacceptable.Fair Trade Certified coffee
21

empowers farmers as gives protection against workers rights by complying with minimum
wage requirements, gives the workers a fair and safe working conditions and addresses child
labour and discrimination.Suppliers also has to be transparent as they have to show proof of
payment. The company can achieve the suppliers loyalty by paying the supplier on time and
practising fair trade with farmers.
Non Market Stakeholders
Non market stakeholders usually uses political and social forces for the sucess of the
company. They practice the standards of business code and have a booklet to guide partners
and oversees the companys expectation on how to conduct business.Starbucks has been
named the worlds most ethical companies for the ninth year in a row.The policy and
advocacy for healthy foods in communities are national labelling standards and Starbucks
also practice responsible growing practices such as C.A.F.E practies and Conservational
practices.The environmental responsibility is taken up by non market shareholders to reduce
the environmental impact like climate change to produce a long term supply of coffee.Green
building, energy and water conservation and recycling are also one of the advanced initiatives
and developed key priorities at store level.
(Slideshare.net, 2012)
2.4 Suggest a new strategy to the organisation for business growth / sustainability
A new strategy that can be adopted for starbucks for business growth and sustainability is to
introduce different types of promotions to the customers to further increase customer
awareness of the brand. Promotions are generally to increase sales of the company as a slight
discount will attract a variety of customers. Therefore, the company should establish a happy
hour whereby the coffee would be half price in that span of time.This would promote the
coffee drinkers to go to the nearest starbucks to go and spend time there which will increase
the amount of clientele and decrease the amount of competitors.This would help boost the
sales at off peak hours and entice new customers that have never tried Starbucks products to
have the Starbucks experience.
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