Starbucks Essay Example | Topics and Well Written Essays - 3250 words

Starbucks - Essay Example It is a public company with its headquarters in Seattle, Washington. Currently, Howard Schultz is the president, chairperson and CEO of the company (â€Å"About Us†). The organization is in restaurant business and serves whole-bean coffee, cold and hot beverages, instant coffee varieties, snacks, pastries and full-leaf teas. Apart from the major selling items, the stores also sell cold and hot sandwiches, packaged food products and other items such as, tumblers and mugs. The business operations are strategically diversified according to the customer trends, traffic as well as demands. For instance, Starbucks Evening offers varieties of wines, beers as well as appetizers after 4 pm. Another arm called Starbucks’s entertainment and brand, Hear Music, markets music, films and books. This is a strategic division with the objective of engaging consumers through different channels. Products and services are seasonal and change according to the store locality as well as local demands. It also reaches another set of target customers through its coffee and ice-cream range offered at various grocery stores. Starbucks’ mission statement is â€Å"to inspire and nurture the human spirit – one person, one cup and one neighbourhood at a time† (â€Å"Mission Statement†). At present, the company is planning to restructure by shutting down unprofitable chains and opening stores in new emerging markets. Also, market saturation is forcing Starbucks to use a more innovative and persuasive approach to reach consumers across various regions. The current report will start with profiling the company, evaluating the current situation and prospects for future. This will be followed by evaluation of the external environment and key success factors for the organization. Strategic Issue Situational Profile and Prospects The potential challenges in front of Starbucks are the increased competition from new and emerging retailers. These retailers may n ot have an identical concept as Starbucks, but they have been able to attract particular category of customers, especially those with low levels of loyalty. Overall economic conditions also pose a strategic challenge for the coffee giant. Starbucks is perceived as a luxury coffee parlour catering high-end customers and corporate professionals. With the recession hit, the company is experiencing loss in many of its store outlets even in prime locations across the globe. This has raised a doubt regarding the feasibility of the present strategic action plans. Also, being perceived as a high-end retail chain, offering discounts and other promotional benefits to increase sales might not go well with its loyal and regular customers (Koehn 25-45). The company’s business operations have also been criticized for over-diversification in recent years by offering products like, ice-cream and chocolates, which did not perform well in the market and negatively affected the bottom-line of t he company. The current strategic direction of Starbucks has also been critici