Loading presentation...

Present Remotely

Send the link below via email or IM

Copy

Present to your audience

Start remote presentation

  • Invited audience members will follow you as you navigate and present
  • People invited to a presentation do not need a Prezi account
  • This link expires 10 minutes after you close the presentation
  • A maximum of 30 users can follow your presentation
  • Learn more about this feature in our knowledge base article

Do you really want to delete this prezi?

Neither you, nor the coeditors you shared it with will be able to recover it again.

DeleteCancel

Make your likes visible on Facebook?

Connect your Facebook account to Prezi and let your likes appear on your timeline.
You can change this under Settings & Account at any time.

No, thanks

Copy of STARBUCKS

EXPO
by

Dolphy Louis

on 29 October 2012

Comments (0)

Please log in to add your comment.

Report abuse

Transcript of Copy of STARBUCKS

HOWARD SCHULTZ APARECE EN LA PELICULA (Brooklyn, Nueva York, 1953) Empresario estadounidense, presidente y consejero delegado de Starbucks Coffee Company, una franquicia con una particular filosofía de los negocios que cuenta con más de 15.000 establecimientos en todo el mundo. 13th Century: Coffee bean discovered in Yemen & Ethopia.
17th Century: Coffee Houses came to North America
1971- First Starbucks store
1982- Schultz joins the company
1987- Bought Starbucks and renamed “Il Giornale.”
1992- Starbucks goes Public
1996- Starbucks opens a store outside North America in the Far East
2009- 17,000 Stores in 56 countries The Starbucks Story Coffee Industry and the Triad Coffee consumption in kg per capita by region and country income Reasons of going abroad Pace – the rate (speed) of opening new stores abroad

The downwards slope indicates a negative association between pace and performance

The best performance years - 2004, 2005, 2006 and 2007 - slower pace of internationalization

Foreign integration has higher effect Pace of Starbucks’ internationalization 1993 - moderate pace, 2nd lowest ROA, 115% increase in firm assets (opening a second roasting plant)
1997 and 1998 – high pace, moderate ROA, acquired Seattle Coffee Company in UK (65 stores already generating revenue)
2001 – high pace, ROA = 10.85%, new expansion strategy, opened a total of 337 stores (252 in UK)
Pace of Starbucks’ internationalization Rhythm – the regularity by which stores were opened abroad
Measured by the Kurtosis of the number of foreign stores over each four-years period
A higher Kurtosis implies a more irregular rhythm
Lower Kurtosis implies a more regular rhythm with higher ROA Rhythm of Starbucks’ internationalization First two blocks (1994-1997 and 1998-2001) – irregular rhythm, high growth (more countries entered) and lower performance
1994-1997 – domestic- regular, foreign – irregular; so, foreign expansion had higher effect Second two blocks (2002-2005 and 2006-2009) – higher performance, regular rhythm
2002-2005 – the highest ROA.
2006-2009 – lower ROA with regular rhythm, because of economic recession and intensifying competition Rhythm of Starbucks’ internationalization Geographical scope – the number of new countries entered

The downwards slope implies a negative association between slope and returns, in our situation flat
First three years of analysis (1993-1995) company operates just in the US and Canada
Too close location to each other Geographical scope of Starbucks’ internationalization 1998 – high scope, according to the pace acquired Seattle Coffee Company in UK
2000 – higher performance with high pace, low country growth
2008-2009- low country growth, lower performance because of economic recession Scope of Starbucks’ internationalization 1998 – high scope, according to the pace acquired Seattle Coffee Company in UK
2000 – higher performance with high pace, low country growth
2008-2009- low country growth, lower performance because of economic recession Scope of Starbucks’ internationalization Industry Sales Growth Rate Low High Low High Relative Market Share Position Boston Consulting Group (BCG) Matrix 2008 – 2010 – closed nearly 1,000 stores
Results:
$580 million in cost savings
Affected earnings by lease termination and severance cost
70% of the stores were re-opened for fewer than 3 years
Pace, Rhythm and Geographical scope - process dependence in building a profitable MNEs Rationalization Program Revenue Current Situation Threats of new entrants
Threats of substitutes
Bargaining power of suppliers
Rivalry among existing competitors
Bargaining power of buyers Porter’s Five-force model PEST Analysis Beginning of 1990s 1st move to Canada
1993-2007 Starbucks’ 17000+ stores in 56 countries
1993 revenue $ 16 million
2007 revenue $10 billion
Takeover and acquisition of local community coffeehouses and buildings
Wholly-owned subsidiary, joint venture, licensee
In March 2003 Starbucks’ name on “Fortune 500 companies” (position 465) Starbucks’ internationalization Beginning of 1990s 1st move to Canada
1993-2007 Starbucks’ 17000+ stores in 56 countries
1993 revenue $ 16 million
2007 revenue $10 billion
Takeover and acquisition of local community coffeehouses and buildings
Wholly-owned subsidiary, joint venture, licensee
In March 2003 Starbucks’ name on “Fortune 500 companies” (position 465) Starbucks’ internationalization-
Agressive or Progressive? 1. Industry-based
Limitation of expansion in US market
Potentiality due to population sizes and the amount of people with high disposable income and with a high interest in Americanization.
Advantage in its innovative strategies of healthier snacks
USA’s membership in NATO, APEC, NAFTA and Pacific Community trading blocks, helped Starbucks get raw materials cheaper
 
2. Resource-based
The firm’s distinctive competences are built from tangible and intangible assets, and organizational capabilities.
financial resources, raw materials, production facilities and real estate
the brand name, reputation, knowledge, experience

3. Institution based views
The main stakeholders in Starbucks are the employees, owners, suppliers and the customers The motives to go abroad can be
analyzed from three different perspectives: High end coffee

Good public image

Industry leaders

Wider demographic reach Strengths Over-priced

Non committal to customization

No Back up plan Weakness Niche markets

Market Share at lower prices

Diversify their business Opportunities Sudden influx of competitors

Cheaper pricing by competitors

Coffee Selection

Popularity of Coffee might die down Threats Franchising

Licensing

Joint Venture

Fully owned subsidiaries Entry Modes Promotion and Advertising
Product differentiation
Variety
Loyalty program and rewards card
Drive through
Corporate market expansion
Focus on developing markets Focus Points Early-adopters in favour of a club-like atmosphere found themselves in a Minority.
Too many new products to broaden appeal.
Tried to gain a share of the ‘grab and go’ market without upsetting the premium coffee experience. Do you think that the growth of Starbucks has destroyed its Brand Value? November 2011: Starbucks acquires Evolution Fresh Inc. and opened Juice Bar.
June 2012: Starbucks to acquire Bay Bread, LLC.
December 2012: Aggressive expansion plans. Open 500 stores in the America’s, 400 in Asia-Pacific and 100 in EEMA.
Transition in retail of CPG from In-House to Direct Distribution Starbucks in the News... First two blocks (1994-1997 and 1998-2001) – irregular rhythm, high growth (more countries entered) and lower performance
1994-1997 – domestic- regular, foreign – irregular; so, foreign expansion had higher effect Second two blocks (2002-2005 and 2006-2009) – higher performance, regular rhythm
2002-2005 – the highest ROA.
2006-2009 – lower ROA with regular rhythm, because of economic recession and intensifying competition Rhythm of Starbucks’ internationalization Industry Sales Growth Rate Low High Low High Relative Market Share Position Boston Consulting Group (BCG) Matrix 1998 – high scope, according to the pace acquired Seattle Coffee Company in UK
2000 – higher performance with high pace, low country growth
2008-2009- low country growth, lower performance because of economic recession Scope of Starbucks’ internationalization 1993 - moderate pace, 2nd lowest ROA, 115% increase in firm assets (opening a second roasting plant)
1997 and 1998 – high pace, moderate ROA, acquired Seattle Coffee Company in UK (65 stores already generating revenue)
2001 – high pace, ROA = 10.85%, new expansion strategy, opened a total of 337 stores (252 in UK) AGENDA Introduction
History of Starbucks
Pace and Rhythm of Starbucks internationalization
Future of Internationalization
Questions and Recommedations
Recent Trends
Full transcript