International Marketing - Starbucks

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Case 1-1 - Starbucks
International Marketing class – Dr. Shivakumar
Alaeddin Khader

Answers to the case study questions: 1. In Its journey to the top of international success in coffee stores, Starbucks has faced a lot of controllable and uncontrollable challenges.

Starbucks started in Seattle in the United States where the people there love coffee and have a lot of coffee shops to visit. That was the first uncontrollable challenge facing the company as it started in nearly saturated environment with lots of competition.

When operating in international market they need to operate through local partner who will cut from their profit so that they will keep only 20 to 50 percent of the profit.

Expansion to international market poses with huge risks. While spreading out they have faced cultural challenges.

Below picture shows the protesters against the globalization attaching Starbucks as they see it as a symbol for the free market international company and represents the globalization.

For the controllable challenges that Starbucks have faced, the company growth largely in the United States as they have participated themselves of saturating the market of coffee shops as their crowding of so many stores so close to each other has become a national joke. Such as the headline in the Onion (a satirical publication): “A New Starbucks opens in restroom of existing Starbucks”. Opening so many stores near to each other will cut the profit of the existing stores.

Starbucks decided to export its concept aggressively to duplicate its staggering returns of the first decade. They operate now 1700 international outlets.

Starbuck faces slumping morale and employee burnout among its store managers and its once-cheery army of baristas. Employees are forced to work more and they pay less for them ha nth actual work…...

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