Introduction
The company involved in this case is the Starbucks Corporation. At the pace the company is developing, it is faced with a risk that some of its missions will not be implemented when entering novel markets across the globe. Some of the critical issues that the company faces have been discussed in the study.
Discussion
When the company entered the world markets as realized from the scenario, some of the controllable components that the corporation has been confronted with are the same as compared to those in the domestic environment, (Albaum, & Duerr, 2008). Such elements encompass price, place, product, and promotion. The image and name of the company connect to millions of its customers across the globe. Starbucks can make adjustments internally to fit perfectly with the expectations and cultural preferences of a nation in regards to the company’s price, product, the type of marketing and its availability. The corporation is also capable of taking part in research of the market to ensure that its product has the accurate and effective fit for beach of its global locations. According to its website, the company maintains a high success level globally by opting to work with partners and stakeholders worldwide also with shared dedication and values to bring the experience of the corporation to customers all over the world. A case in point is the price. Coffee bars in Italy, for instance, succeed by serving its customers food as well as coffee. This is an area that the company is still grappling. Besides, the coffee in Italy is affordable than java in the United States.
Additionally, the company has been confronted with the uncontrollable issue as it strives to enter the global markets. In a country like Italy, Starbucks need to adjust to the changing conditions of the market, the competition with local coffee giants and the tastes of the consumer. Just as discussed in the study, coffee bars are at the top by serving both food and coffee. The coffee in this nation is also costlier as compared to that in the United States and is also perceived by the locals to be superior (MacDonald, 2007). The economy of the nation is also another uncontrollable component. For instance, Japan has been going through depression, and the corporation’s branch in Japan experienced a 14% decline in profits. Another facet is competition between coffee giants besides legal and political bindings that vary from one particular nation to another as labor continues to benefit. Starbuck is something novel in diverse states, and the young consumers usually exhibit enthusiasm and embrace any new launch and production of the company.
Starbucks is also grappling with the issue of worldwide recession which has consequently led to move consumers to brands that are way cheaper. There is also the issue of decreased wages that both managers and employees are confronted. Managers and employees have also been leaving the company as frustrated individuals due to the numerous filed lawsuits. In fact, this costs the company approximately 18 million dollars to cover the costs of the lawsuits subsequently leaving it on the decline regarding the share of the profit.
Recommendations and conclusions
First, Starbucks Corporation should put more focus on global expansion especially in BRIC nations that are known to boast extremely increased growth. Differentiation of the product should also be a key factor such as Starbucks’ product adaptation to the standards of a particular nation. They should also re-position their products and emphasize more on the middle class rather than focusing on the higher-income group. To avert issues of culture, Starbucks should develop international strategies in regards to the locations to attain success through ensuring research of the beliefs and culture of other nations and introduce products by their preferences. Lastly, Starbucks should focus on quality improvement of both its services and coffee by maintaining the happiness of its employees.
- Albaum, G., & Duerr, E. 2008. International marketing and export management. Pearson Education.
- MacDonald, K., 2007. Globalising justice within coffee supply chains? Fair Trade, Starbucks and the transformation of supply chain governance. Third World Quarterly, 28(4), pp.793-812.
