Starbucks

Industry definition:
Global specialty java

-suppliers: specialty coffee exporters (pg 8).

-final customers: individuals.

- diffusion channel: retail coffee houses, large retailers.

-Fragmented, many regional players + sensation store shops + few powerful players (SB in the US, min loving cup in Canada).

-Product-based and retail-based competition.

1. Threat of entry: high
a. Cost advantages: economies of scope, invite curve i.e. learning how to choose the right retail locations and how to accept employees to provide high quality service. Economies of scale: bean roasting, distribution, get in high volume
b. Capital requirements: low for single presidency but moderate for large operations
c. Brand identity: high, production selection is important as well as customer experience
d. Access to distribution: difficult to achieve large-scale, broad distribution i.e. being in grocery stores, restaurants, airports, AND coffee shops

Intensity of contest: high
Product based competition and retail-based competition.
Concentration, -Fragmented, many regional players + one store shops + few powerful players (SB in the US, Second transfuse in Canada). 3485 incumbents, most were one store with no plans for growth.



up to now SB controlled 34% of the US market stores and 56% of the Canadian ones. The same numbers can be found in the top 100 US and Canadian markets. Second Cup is its major competitor, particularly able to build strong alliances with diet industries. Other regional and national competitors are also present, they bring a focused diversification strategy and have a smaller number of stores.

Fixed Costs, low. Mainly real terra firma and fixed capital for beans toasting. Easily avoidable through partnerships, leasing or long term alliances but key for a prospered strategy.
Growth, opportunity for growth in US and Canada (room for other 11000 retail outlets, and 5500 coffee shops) and emerging markets. The specialty...If you want to get a plentiful essay, order it on our website: Orderessay



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