Starbucks BRAZIL
Starbucks Corporation
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Prepared by:
Aminata Ouattara
Daniele Albagli
Melissa Butz
Matvey Kostromichev
Presentation Outline
Starbucks Corporation
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Introduction
Mission & Objectives
PESTEL Analysis
PORTER Analysis
SWOT Analysis
Capabilities
Strategic Choices
Strategic Implementation
Conclusion
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Introduction
Starbucks Corporation
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Mission & Objectives
Starbucks Corporation
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The current mission of Starbucks is:
To create an agreeable working environment and to treat others with dignity
and respect.
To consider the diversity as a fundamental component of our way of working.
To apply the highest standards of quality in terms of purchasing, producing,
and delivering of our coffees.
To develop continuously and with enthusiasm the satisfaction of our clients.
To bring a positive contribution to our society and to our environment.
To know that our profitability is essential to our future success.
Objectives of Starbucks are:
To follow the global strategy.
To be recognizable as the greatest coffee chain in Brazil.
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PESTEL Analysis
Starbucks Corporation
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Political:
The government stimulates the customers’ purchasing power.
Brazil’s political situation is continually improving.
The Brazilian government is encouraging foreign investors to open coffee
businesses.
Economical:
BRIC countries.
Brazil has an average annual growth rate of 2.4% since 1980.
The Brazilian coffee consumption rate rose 3.96% within the last 12 months.
Current fiscal and monetary policies are designed to stabilize the public debt
levels.
Brazil is the second-biggest coffee consumer, following the U.S..
Brazil has high importation taxes.
PESTEL Analysis
Starbucks Corporation
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Social:
93% of the Brazilian population is regular coffee consumers.
Income distribution is extremely uneven.
Education level is higher in the metropolitan areas.
Consumerism is high, and there is a demand for higher quality products.
Technological:
Most of the technology is imported.
Environmental:
Weather
Legal:
Employees are protected by employment laws ensuring proper work hours,
benefits, and sanitary conditions.
There are regular audits in order to monitor the quality of the supply chain.
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External Environment Analysis PORTER Analysis
Starbucks Corporation
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Customers:
Have a high bargaining power.
Competitors:
Many competitors but with lower quality.
Suppliers:
Only one local supplier. The rest will be
imported.
New entrants:
The threat of new entrants is high.
Substitutes:
Fruit juices as an additional alternative
to refreshments.
External Environment Analysis SWOT Analysis
Starbucks Corporation
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Threats:
Price: Starbucks has higher products’ price than have its competitors.
Competition of established local coffee chains who already have their regular
customers.
Substitute products such as teas, fruit juices, etc.
Opportunities:
The size of the Brazilian consumers market looking for quality products and
good services is growing.
Consumers looking for differentiated service.
The cafeteria market has not been explored, which leaves room to Starbucks to
be equally welcomed.
Brazil has a potential for producing more quality coffee than it is currently doing.
Starbucks has an immense potential of success due
to its differentiation strategy.
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Internal Environment Analysis
Starbucks Corporation
SWOT Analysis
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Strength:
Brand Recognition and Global Dominance.
Customer Service excellence.
Differentiated product.
Starbucks own all of their stores.
Visionary leader.
Low turnover rate.
Weakness:
Starbucks has the most expensive coffee in the market.
There is only one local supplier, Brazil Ipanema Bourbon.
No smoking area.
Capabilities
Starbucks Corporation
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The Key Success factors for Starbucks are:
Brand Recognition.
Global Dominance.
Customer Service Excellence.
Financial Resources.
Innovative Business Strategy.
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Strategic Choices
Starbucks Corporation
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Our Goal:
To develop a market for Starbucks’
specialty coffees in Sao Paulo, Brazil.
Suitability:
Internal development is the best way for
Starbucks to enter a new market.
Acceptability:
There is little to no risk involved with the
method of internal development.
Feasibility:
Funds are not an issue as Starbucks
has the money to invest in new markets.
Corporate Strategy:
Starbucks Corporation provides comprehensive
support to all of its stores, especially the ones
opening up in new markets.
Strategic Implementation
Starbucks Corporation
Operations strategy
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First step:
Find an investor.
Second step:
Wait for good profitability.
Third step:
Starbucks Corporation buys “franchise”
from investor.
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Strategic Implementation
Starbucks Corporation
Operations strategy
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Organizational Structure for Starbucks Sao Paulo:
President in Brazil
Marketing
Operations
Finance
Store Manager
Assistant Manager
Shift Manager
Baristas
Strategic Implementation
Starbucks Corporation
Marketing Strategy
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The Internal Strategy:
Invest in the training of our partners (employees) in hand-crafting
coffee.
Hire individuals who are “adaptable, self-motivated, passionate,
creative and team-oriented.”
Partners will also be motivated through a scheme of incentive from
opportunity for professional development, to automatic benefits
package, or stock options.
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Strategic Implementation
Starbucks Corporation
Marketing Strategy
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The External Strategy
Segmentation: we will target Brazilians of all social conditions living in Sao Paulo, but more
specifically the business people and the shoppers around the Starbucks
coffeehouse.
Positioning:
Products:
Starbucks Corporation has a line of food, music, beverage and related articles,
which will be introduced in the Brazilian market.
Price:
Starbucks’ coffee price will be higher than the Brazilian competitors’ prices.
Place:
Starbucks’ coffeehouse in Sao Paulo will open in a carefully selected place.
We will choose a location central to business customers and shoppers.
Promotion: In line with Starbucks Corporation corporate social responsibility policy, we will
also initiate actions towards a positive impact in the community.
Distribution The machines will be imported from Starbucks Corporation (Seattle) in
channel:
case there are not any potential suppliers in Brazil.
Conclusion
Starbucks Corporation
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The time is right for Starbucks to invest in Brazil. Analysis of the
environment shows that the economy, as well as the culture, in Brazil
is very promising for foreign investments as it is considered an
emerging market.
Sao Paulo has been chosen as the city which will host the flagship
Starbucks retail store, due to its affluence and great locations.
Although there are many competitors, Starbucks will introduce a new
concept of enjoying a cup of coffee and will carry out its usual
business strategy of added value differentiation and costumer
satisfaction.
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Starbucks Corporation
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“Perhaps we have the opportunity to be a different type of
global company, a global brand that can build a different
model, a company that is a global business, that makes a
profit, but at the same time demonstrates a social
conscience and gives back to the local market.”
Howard Schultz,
CEO of Starbucks
Questions & Comments
Starbucks Corporation
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Thank You!
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