Starbuck - A story of growthCOPY

Starbuck - A story of growthCOPY - Starbucks A story of...

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Starbucks: A story of Growth…
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Strategic challenges of growth Brands with successful strategies have great opportunities to grow - & exploit all markets that its strategies are well suited to. Having grown “fully” the firm must choose between “stopping to grow” & “reinventing its strategy”. Both options have potential benefits & costs . Reinventing is not easy & organizations resistant change.
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Strategic challenges of growth New markets require new assets the firm may lack. Also, past success may actually hinder ability to see clearly what is required next. Starbucks developed a successful strategy that resulted in growth . It chose to adapt its strategy to exploit new opportunities & had to deal with trade-offs & consequences. Growth is only a tactic to achieve strategic goals - not a strategy in itself.
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Activities vs Assets A firm performs activities - visible things - to meet customer needs. Assets are resources & capabilities to perform activities .
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Starbucks Activities Assets Sell high quality coffee with a more robust flavor. Skilled baristas trained to pull shots, recommend coffee, provide friendly, customized service. Offer large variety of espresso- based drinks handcrafted by trained baristas. Sourcing, roasting, distributing, & finding distinctive, high quality coffee. Provide customized &personalized service each customer. Upscale locations with comfortable layout & furnishings and inviting aroma. Offer experience in a comfortable, local, boutique style environment – “the third place”. Brand that incorporates all of the above.
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Starbucks: A Story of Growth Over FOUR decades : from ONE location in Seattle, Washington, to a multi-billion dollar enterprise, with 17,000 retail stores in 50 countries. Stating with coffee beans & ground coffee on to Italian-style espresso, cold blended drinks, food items, premium teas & beverage-related accessories & equipment.
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Starbucks: A Story of Growth We have won in many ways, but I feel it’s so important to remind us all of how fleeting success and winning can be. Howard Schultz, CEO
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History of Starbucks Founded in 1971, when coffee consumption in the US was on the decline . Most Americans preferred home brewed Folger’s, Maxwell House, Nescafe instant. Coffee served at diners/ restaurants . Competition : Local coffee houses e.g. Peet’s. 1982: Five Starbucks retail outlets - sold beans, not prepared coffee.
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Howard Schultz Worked for Swedish house-wares company . Starbucks bought more coffee filters from company than most others. Shultz applied for/ got a job at Starbucks. Attracted to Italian espresso bars during business trip to Milan, Italy . Suggested opening restaurants - was refused.
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Il Giornale 1986 : left Starbucks to open Il Giornale.
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