Starbucks

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Category: Business and Industry

Date Submitted: 07/15/2014 07:13 AM

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* Starbucks Coffee Company faced many interesting and significant events in 2013 and 2014.

* Starbucks ended its three-year fight with Kraft Foods.

* The two companies entered into a partnership in 1998, whereby Kraft was to assist in distributing and marketing Starbuck’s brand coffee in US and late global grocery stores.

* In 2010, Starbuck’s felt Kraft was not doing enough to promote and stock the coffee in the stores. Starbuck’s offered Kraft $750 million, but it was declined. In 2011, Starbuck’s withdrew from the partnership, and Kraft began to seek arbitration.

* Starbuck’s was ordered to pay $2.76 billion in damages and attorney fees.

* In a revised financial report, Starbucks said its earnings for the fiscal year to $8.3 million, or $.01 a share, after accounting for the litigation charges.

* Howard Schultz, Chairman and CEO of Starbucks, found it strategically sound to begin to implement alcohol in the stores. He stated it would be another way to increase the average sales per person.

* Rolled out in 2010 in a Seattle’s Best Coffee shop implemented a wine and beer menu in 10 different stores. Since the roll out of alcohol in the Seattle’s Best stores, the Starbuck’s chain began to implement the “Evening Menu” in select stores. Lisa Passé, a Starbuck’s spokesperson stated "[the] concept is a natural progression for Starbucks as we seek to create a new occasion for customers to gather, relax and connect with each other in the evenings." The limited menu would feature selected beers and wine along with an expanded food menu.

* This would drastically increase sales at times when coffee sales alone are slow. This could pose a strategic mistake, however, as Starbuck’s focuses on sensory marketing. The company failed once prior when they implemented cheesy breakfast sandwiches that didn’t mix well with the coffee smells.

* In January of 2014, Starbucks Coffee Company...