SWOT Analysis

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Marketing

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Nov 24, 2024

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SWOT Analysis: Starbucks Student Name Tutors Name Course Date

Introduction • Customers may choose from a wide variety of excellent coffee beverages and fresh cuisine at Starbucks, the world's top coffee business. • Over 60 nations across the globe, it has more than 21,000 outlets, which are visited by an estimated 60 million people each week, Starbucks has just launched a brand of organic coffee beans, offering high-quality drinks at an affordable price. • The coffee sector is dominated by Starbucks, which has a large number of outlets. While growing abroad, the firm has maintained its competitive position by listening to its consumers and being inventive. • Intangibles such as a strong brand-public image connection and a large supply chain make Starbucks a formidable competitor. • This presentation will provide a SWOT analysis of Starbucks Inc.

SWOT Analysis: Starbucks Strengths • The first strength is that Starbucks has Strong Correlation Between Brands and Public Image.  It has developed to take advantage of new and emerging channels for consumer connection as the company's brand strategy keeps pace with time.  Customers have grown in size, volume, and quantity as a consequence. In 2019, the brand's value was estimated at $11.7 billion USD.  According to Madhav (2022), the firm rebranded its coffee as a high-end product.  By creating popular goods and engaging in public relations campaigns, Starbucks has maintained a strong brand presence.  The notion of brand culture is connected to the idea of strength from these three angles.

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SWOT Analysis: Starbucks Strengths (cont.) • Starbucks' extensive supply chain is another strength of the business.  Starbucks' supply chain is optimized via the utilization of a diverse variety of goods and company volumes.  Because of this, the firm has been able to increase consumer satisfaction by sourcing coffee beans from over 30 countries across the world (Madhav, 2022).  Apart from that, Starbucks has an extensive global supplier network and utilizes a vertically integrated supply chain to track every stage of this process.  The firm also provides four great programs for supplier training and education and works closely with them to integrate them into the organization.  Consequently, Starbucks has built an enormous supply chain that is essentially impenetrable to substantial interruption (Sargent, 2017).

SWOT Analysis: Starbucks Weaknesses • Starbucks over depends on major ingredient  Because the company relies so heavily on coffee beans, the cost of coffee beans serves as a crucial measure of its profitability.  Because of this, Starbucks should broaden its product line in order to reduce the risk associated with such reliance on the price swings of coffee beans (Doward, 2020).

SWOT Analysis: Starbucks Weaknesses (cont.) • The company has also attracted public negativity in the new lately.  In addition, the company has lately come under fire for its procurement policies, with environmental and social campaigners highlighting the exploitation of impoverished third- world people for the purchase of espresso beans (Petljak et al., 2018).  In addition, the company has been criticized for ignoring the "Fair Coffee Trade" standards, which were put in place two or three years before this specific problem was handled by them.

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SWOT Analysis: Starbucks Opportunities • Increase customer experiences  The customer experience at Starbucks is one of the opportunities the company can capitalize on.  Starbucks will be able to establish more locations and generate more money as a result of this potential. It is because of this that first-time client wind up guessing rather than just asking for coffee.  Their desire would have been for something more sophisticated, which would have ensured their continued employment with the company.  Instead of purchasing something they could acquire at a lesser price from a different company, they choose to place an order with them in the future.

SWOT Analysis: Starbucks Opportunities (cont.) • Increasing customer involvement.  Starbucks also has the chance to increase consumer involvement.  In addition, this is a chance for Starbucks to grow and create more revenue from their goods.  Because Starbuck does not have consumer engagement in their company, the potential exists.  Taking advantage of the chance would help grow the firm by attracting new clients.  According to Rusconi (2019), as such, customers would able to identify and address client concerns and preferences  This would resulting in a more positive customer experience and a higher rate of customer loyalty.  Consumers' concerns would be handled and their ideas would be taken into consideration, resulting in a positive connection between the firm and its customers.

SWOT Analysis: Starbucks Threats • The business faces a lot of completion  As a result of competition from smaller coffee shops, Starbucks has had to deal with the first major external threat.  In especially in the United States, local coffee shops are being promoted as a pillar of the community.  Because these coffee shops have a more local ambience and a friendly social setting, they represent a serious challenge to Starbucks.  Other food firms, like McDonald's, who are still in the coffee industry, pose a challenge to Starbucks.  For almost two and a half decades, McDonald's has offered flavored and iced coffees as an option for customers.  In addition, Starbucks' core product may be readily replicated since coffee is a staple commodity that is eaten globally.

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SWOT Analysis: Starbucks Threats (cont.) • The business like any other faces harsh economic times • The Covid-19 epidemic is also a danger to Starbucks at this time. • Many firms have been impacted by the epidemic, but the mandate to shut Starbucks stores was particularly devastating for the company (Gaille, 2021). • Many people were obliged to remain at home during the flu pandemic, which meant that restaurants had to operate with a smaller client base; this meant that the number of customers decreased significantly. • The global recession, which is forecast to decline by 5.2%, is the last challenge confronting Starbucks. • People who normally spend money on Starbucks' high-end brand 4 image may be forced to do so because of the present global economic downturn. • Because a cup of Starbucks coffee is considered a luxury, the recession poses a danger.

Recommendations for Starbucks • To ensure that each cup adheres to C.A.F.E. practices, Starbucks' management must develop standards for cultivation, production, quality, and procurement. • Starbucks, on the other hand, may take advantage of the various pricing models and provide a variety of price points that will not seem to be more costly. • Starbucks has to focus on getting to know its consumers better. • This includes learning their purchase habits, what they desire, and building a strong connection with them. • Starbucks may use the B2C model to execute their marketing and successfully engage with their current consumers. • Ethical guidelines should be established by the organization in order to ensure that the company's policies are in accordance with both national and international laws, as well as the rights of its employees.

References • Doward, J. (2020). Children as young as eight picked coffee beans on farms supplying Starbucks. The Guardian. • http://www.acadpubl.com/Papers/Vol%204,%20No%202%20(IJSSU%202021).pdf#page =39 • Gaille, B. (2021, March 18). Starbucks SWOT analysis (2021). BrandonGaille.com. • Madhav. (2022). Starbucks SWOT analysis. https://seoaves.com/starbucks-swot-analysis/ • Petljak, K., Zulauf, K., Štulec, I., Seuring, S., & Wagner, R. (2018). Green supply chain management in food retailing: survey-based evidence in Croatia. Supply Chain Management: An International Journal. • Rusconi, G. (2019). Ethical firm system and stakeholder management theories: a convergence. European Management Review, 16(1), 147-166. • Sargent, M. (2017). Supply chain putting the star in Starbucks. https://www.fronetics.com/supply-chain-putting-starstarbucks/#:~:text=The%20Standa rds,of%20coffee%20sold%20to%20consumers

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