Starbucks Coffee

Background

Starbucks coffee has pursued rapid expansion both at home and abroad. In mid- 2004, Starbucks could boast more than 7,800 outlets around the world, and chairman Howard Schultz and CEO Orin Smith have no plans to slow the growth,

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The company planned at least 1, 300 more stores in 2004 and has a long term goal of reaching 10, 000 outlets in the United States alone. The president’s vision is that the company ?Starbucks?could have as many as 15,000 international stores.

Today Starbucks has nearly 1, 500 store outlets in the United States including Europe , Pacific Rim ,Middle East and Mexico.

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Most of Starbucks international stores are now operated as joint ventures with local companies. Starbucks has to go fast or lose the opportunity ? and a local partner can facilitate rapid development of a new market. Executives are learning to adapt the company’s operating methods and product offerings to better suit local conditions and tastes.

1)    ?How could you classify Starbuck’s grand strategy and global strategy? Which of Porter’s competitive strategies is the company using? Explain each answer?

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We classified the grand strategy of starbucks pertaining to its Growth. In order for starbuck’s to sell and market it’s products is by:

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A.  ?Allocating new funds to invest namely like prime locations and lots. Basically any establishment will earn more if the store is located in a highly busy route or place. Potential clients can be marketed.

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B.     Investing in hiring the best and qualified personnel. In order for a store to run smoothly , the company should have competent and high breed of people who can manage the store and the same time enjoy the work itself.

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C.  ?Purchasing of new set of equipments , glassware , lighting , tables and chairs can be a plus factor for a good ambiance.

For the Global Strategy , Starbuck is implementing Transitional process where in they seek to achieve both global integration and national responsiveness. A true transitional strategy is difficult to achieve , because one goal requires close global coordination while the other goal requires local flexibility. However a lot of increased competition means they must achieve global efficiency , going pressure to meet local demands and national responsiveness. Starbuck’s designs quality stores to sell and market its products to use components in a few larger scale, basically , the company goes global to introduce it to other countries and to increase