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Applied Strategic Management - MAN0209M

Individual Assignment Outline


Name: Samiya Sheikh
UOB: 12032279
Company: Starbucks

Activities undertaken and the external environment:

Starbucks

Corporation

is

an

American

global

coffee

company

and

coffeehouse chain based in Seattle, Washington. It is the largest coffeehouse


company in the world ahead of its UK rival - Costa Coffee, with 21,160 stores
in 63 countries and territories, including 12,067 in the United States, 1,570 in
China, 1,451 in Canada, 1,070 in Japan and 793 in the United Kingdom. It
dominates the industry with a market share of 36.7%, Dunkin Brands with
24.6% and other competitors like McDonalds, Costa Coffee, Tim Hortons etc.
Starbucks belongs to the food service industry, but more precisely, it belongs
to the coffee industry. Their outlets serve hot and cold beverages, wholebean coffee, micro ground instant coffee, full-leaf teas, pastries, and snacks.
Most stores also sell pre-packaged food items, hot and cold sandwiches, and
items such as mugs and tumblers. Starbucks Evenings locations also offer a
variety of beers, wines, and appetizers after 4pm. Through the Starbucks
Entertainment division and Hear Music brand, the company also markets
books, music, and film. Many of the company's products are seasonal or
specific to the locality of the store. Starbucks-brand ice cream and coffee are
also offered at grocery stores.

Challenges faced:

- Rivalry among established companies: High.

Example: Costa coffees market segment is closed to Starbucks, which also


uses the luxury coffee and the comfortable environment to attract the
middle-class. As the demand of the coffee in the west is saturated, the
competition is quite fierce.
- Potential competitors:
Starbucks

biggest

potential

competitors

are

the

fast-food

leading

corporations like McDonald & KFC. Both companies have economies of scale
hence; it is easy for them to launch into the coffee industry and take the
market share from Starbucks.

Source of Information:

Information of Starbucks will be acquired from various journals, case studies


and internet sources available.

Reason for choosing Starbucks:

As an avid Coffee lover, I often visit their outlets and extremely enjoy the
range and quality of products offered by Starbucks. After reading articles
online, I inferred that it is one of the top most brands in the coffee industry.
As the branding of the company has been created innovatively, along with a
deep market penetration, this is greatly inclined to the strategic plan
adopted by them. Hence, I have chosen this company as a part of my
Applied Strategic Management project.