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Starbucks in addition has to be aware of some possible threats that may arise. Weather is always a factor in any type of farming industry. In some situations, it can put companies out of business. For example, in 1975 the Brazilian frost drove the price of coffee up, and U.
S. coffee consumption declined 18. 5 percent (Taney). There are also a number of other environmental factors that need to be taken into account. These can include health of the coffee trees, harvesting practices, disease and infection caused by insects, and the social, political, regulatory and economic environments of the coffee-producing countries. Another threat that could pose as a problem to Starbucks is a change in consumer preferences. Right now, the specialty coffee industry is riding a wave of popularity for their products, but it is only a consumer trend, and trends do not always last forever.
This may be something Starbucks will be forced to think about in the near future. Additionally, Starbucks will always have the threat of competition in the specialty coffee market. Specialty coffee does not only compete with basic coffee, but it also competes with similar beverage products such as tea, juice, soft drinks, and alcohol. The largest competitor for Starbucks is the Second Cup franchise (Schultz). This company is very growth-oriented, and does so via acquisitions. Second Cup is growing, and shows no signs of slowing down.
When evaluating Starbucks strengths versus weaknesses and opportunities versus threats, it is quite apparent that the company is in a strong competitive position. There are strengths at all levels of the business, from top management, to low-level employees, to company suppliers, and even consumer loyalty (Talbot). They have created a business that people perceive as being professionally run, with strong values, and great work ethic. To consumers, the name Starbucks means quality, and in the specialty coffee industry there is no substitute for it. When looking at company weaknesses, there is nothing that is of serious concern for the business. Issues like how to market the Starbucks name is a problem that most organizations are facing today.
Once a marketing strategy has been defined, and an image has been created Starbucks will then be able to move on to become the preferred consumer brand. There are also many parts of the organization that could be affected by its growth. These areas include the supply channels used by Starbucks to receive their specialty coffee, and their employment strategies. Quality is the concern for both of these areas. It is becoming increasingly hard for suppliers to both meet the quality standards that Starbucks demands, and still produce a timely, and quality product. Perhaps a way to relieve some of this pressure, and dependency on the suppliers is for Starbucks to grow its own high-quality coffee.
Starbucks has many viable opportunities available for them, and should pursue each of them to some degree. Anything should be a possibility, as long as the company does not get away from its current perception of quality. As a successful company, you never want to spread yourself too thin, and ruin a good opportunity. The threats that Starbucks has are ones that any normal competitive company would have. One that they could possibly prevent is a decline in company sales due to a change in consumer preferences. Starbucks has already begun to diversify its products by introducing bottled beverages, competing in the ice cream industry, and placing the product in grocery channels, which helps protect against changing trends in the market place (Tiffen).
As long as Starbucks continues to keep its current strategy to provide a premium quality product to the consumer, whether it is coffee, ice cream, Frappuccino, or any other niche it decides to take on, there should be no decline in the growth of this company. Starbucks follows six guiding principles to help measure the appropriateness of their decisions. They are as follows: 1) Provide a great work environment and treat each other with respect and dignity. 2) Embrace diversity as an essential component in the way we do business. 3) Apply the highest standards of excellence to the purchasing, roasting and fresh delivery of our coffee. 4) Develop enthusiastically satisfied customers all of the time. 5) Contribute positively to our communities and our environment. 6) Recognize that profitability is essential to our future success (Schultz). These principles are the essence of Starbucks.
They have been instilled into every employee, and every employee believes in them. For a company to be such a success in any industry, and to have the ability to grow in the future employees need to have this type of mentality.
Free research essays on topics related to: ice cream, coffee industry, quality product, specialty coffee, consumer preferences
Research essay sample on Specialty Coffee Ice Cream
