Starbucks Is the Leader of the Coffee

Starbucks is the leader of the coffee and coffee-based beverages industry across the world, having transformed the simple act of drinking coffee into a valuable and memorable experience. The business model implemented by the firm is based on the creation of various coffee and coffee-based beverages, of a multitude of flavors and sold in pleasant stores across the globe. The Starbucks stores integrate relaxing and modern ambiance, free wireless internet, pleasant music and they are the fashionable place for young adults to meet and share enjoyable experiences.

Starbuck's mission is represented by the desire to "inspire and nurture the human spirit -- one person, one cup and one neighborhood at a time" (Website of Starbucks, 2012). Its vision is that of being a place where people meet and experience pleasant moment, beyond the consumption of coffee, and that this vision be transported throughout the entire world. The goals and principles by which the company directs its daily operations refer to the following:

High quality coffee, reflecting ethical sourcing of the beans, roasting and the improvement of the communities growing them

The treatment of the partners (staff members) with respect and dignity

The desire to commit with the customers beyond the delivery of high quality beverages

The creation of stores which promote enjoyment

The commitment to operate in a manner that is responsible and beneficial towards the neighborhood and the environment

The commitment to create value for the Starbucks shareholders (Website of Starbucks, 2012).

In order to better understand the company, it is now useful to look at it through the lenses of the SWOT analysis, a practical tool for marketing analysis. The primary strengths, weaknesses, opportunities and threats characterizing Starbucks are revealed in the table below:

Internal strengths

Internal weaknesses

- Long lasting presence within the market place

- Strong branding strategy, coupled with capitalization on the brand

- Positive reputation and image among the customer base

- Sustainable financial results

- Employee support and loyalty, the firm being one of the best employers in the world (CNN Money, 2012)

- Strong internal commitments to protecting the well-being of environments and communities

- Large size which often means that the firm is inflexible and can be difficult to manage

- High retail prices

- Low levels of diversification as the company sells coffee and coffee-based beverages

- High concentration of stores in the U.S., with decreased global presence

External opportunities

External threats

- Opportunities for global expansion

- The ability to integrate technologic developments in company operations

- The possibility of creating and selling new types of products

- The internationalized economic recession

- Intense competition

- Accusations of poor treatment of the farmers in coffee bean growing countries (Colvin, 2010)

As it has been revealed from the SWOT analysis, the company presents a series of advantages and opportunities for development, which will create a positive sense for the investors. Still, aside from these, the weaknesses and the challenges in the external environment raise a series of threats that need to be carefully understood by the investors. These refer to the following:

Change management is expected to be difficult to completed and the company might find it difficult to quickly and efficiently respond to the changes in the market place.

The pricing strategies are aimed at the experience provided by the company, rather than the actual product; this virtually means that the Starbucks coffee and coffee-based beverages are less competitive due to higher prices.

The low levels of diversifications mean that Starbucks is entirely dependent on the retail of coffee and coffee-based beverages. This makes the company sensitive to any changes in the industry, such as limitations on coffee bean exports, increases in the cost of transportation and so on. In case such threats come to materialize and impede the activity of Starbucks, the company's low diversity would make it difficult for the company to overcome the challenge and reshape its business model.

The high concentration of stores in the North American country also indicates a sensitivity towards the domestic consumers. If changes occur in the behaviors of the U.S. consumers, the company would be directly and immediately impacted, without a real ability to counter argue these changes with sustainable revenues from its international operations.