Starbucks

Primary problem:

The primary problem that Starbucks is facing in this case is successful and sustainable international expansion. The coffee chain is already dealing is overcrowded US market. In order to continue its trend of high revenue and profit growth Starbucks will have to depend on its international stores. Starbucks has to not only successfully enter more foreign markets, but it has to be able to achieve sustainable growth and loyal clientele. This might be challenging due to the growing international competition and cultural differences. The company`s strategy needs to be adapted and personalized to the specific market in order for Starbuck to gain and keep large market share after the initial excitement of the locals disappears.

Secondary problems:

Starbucks is also facing some additional problems, such as:

* Toughest challenge in the home market is attracting the next generation of customers. Younger customers are put off by the high prices of Starbucks coffee or find its stores` atmosphere dull or pretentious.

* Starbucks at every corner – the large number of Starbucks locations in the USA could cause customers to get annoyed over having fewer choices.

* Decreased employee morale. What was once an exciting and positive working environment has turned into ……. Starbucks is modeled around enthusiastic service and the changing attitude of its employees could have negative consequences for both company`s image and sales.

* CSR and/or offer food

Recommendation:

In regards to the primary problem, we recommend that Starbucks management take a more conservative approach to its plans for global expansion. In line with Howard Schultz’s thinking, we believe it is essential to concentrate on catering to the cultural needs of each region into which Starbucks expands. In order to do this properly, we believe a slower approach to expansion should be considered. In the case, Starbucks expressed concern that the logistics and management of...