Module 5A. SWOT Analysis

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Module 5| Starbuck’s SWOT Analysis Hillary Luvis Southern New Hampshire University Marketing Analytics March 21 st , 2023

Starbucks is a multinational coffeehouse chain, its headquarters are based in Seattle, Washington. The company was founded in 1971 as a store and has grown to become one of the largest and most recognizable coffee chains worldwide. “Starbucks operates 18,253 company operated and 17,295 licensed stores worldwide” (Gupta, 2023). The company possesses many qualities that have contributed to its strong position and success in the market. Strengths Weaknesses  Strong brand recognition  Global presence  Product diversification  Ethical sourcing  Premium pricing  Dependence on coffee  Limited menu customization  Store saturation Opportunities Threats  Expansion into emerging markets  Digital innovation  Product innovation, the company could expand its menu selection to cater to a wider audience  Strategic partnerships  Intense competition  Economic downturns  Fluctuations in coffee prices  Societal trends Strengths:  Starbucks is one of the most recognizable brands in the world, with a strong reputation for quality and innovation.  Starbucks has a global presence, with more than 30,000 stores in over 80 countries, which provides the company with economies of scale and the ability to capture diverse consumer markets.  Starbucks has diversified its product offerings beyond coffee to include tea, juices, pastries, and other food items, which helps to attract a wider customer base.

 Starbucks has a strong commitment to sourcing its coffee beans ethically, which fosters brand loyalty among customers who value social responsibility. Weaknesses:  Starbucks' premium pricing strategy may make it less accessible to price-sensitive consumers, which could limit its market share in some regions.  Although Starbucks has diversified its product offerings, it remains heavily dependent on coffee sales, which makes it vulnerable to fluctuations in coffee prices.  Despite offering a wide range of products, Starbucks' menu customization options are limited, which could result in lost sales to competitors that offer more customizable options.  Starbucks has a significant number of stores in some regions, which could lead to oversaturation and cannibalization of sales. “Intense competition can lead to price wars and other forms of price competition, which can impact the company’s margins and profitability” (Geereddy, n.d.). Opportunities:  Starbucks has the opportunity to expand into emerging markets, where there is a growing demand for coffee and other specialty beverages.  Starbucks has the opportunity to leverage digital technology to enhance the customer experience, such as through mobile ordering and payment options, personalized promotions, and loyalty programs.

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 Starbucks has the opportunity to develop new and innovative product offerings, such as plant-based food and beverages or new coffee blends, to attract new customers and retain existing ones.  Starbucks has the opportunity to form strategic partnerships with other companies, such as food delivery services or entertainment providers, to expand its reach and customer base. Threats:  Starbucks faces intense competition from both local and global coffee chains, as well as from non-coffee competitors such as fast-food restaurants and convenience stores.  Economic downturns can lead to reduced consumer spending on discretionary items like coffee, which could negatively impact Starbucks' sales and profitability.  Fluctuations in coffee prices could impact Starbucks' profitability and supply chain operations.  Societal trends, such as a growing concern over the environmental impact of coffee production or changing consumer preferences for healthier food and beverage options, could impact Starbucks' brand image and sales. References Gupta, S. (2023). Starbucks SWOT 2023 | SWOT Analysis of Starbucks. Business Strategy Hub. https://bstrategyhub.com/swot-analysis-of-starbucks-starbucks-swot/

Pereira, D. (2023, January 12). Starbucks SWOT Analysis (2023). Business Model Analyst. https://businessmodelanalyst.com/starbucks-swot-analysis/ Geereddy, N. (n.d.). Strategic Analysis Of Starbucks Corporation. Harvard Scholar. https://scholar.harvard.edu/files/nithingeereddy/files/starbucks_case_analysis.pdf

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