Strategic Implementation, Evaluation, and Control in Starbucks - Report Example

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The strategic business management and planning procedure is becoming more and more widely utilized across firms in various industries. Starbucks is the worlds number one coffee retailer (Harrington et al., 2017). The company produces a variety of beverages and other confections and pastries. However, with over 17, 000 stores, the company have its strategic plan just like all other multinational families. As indicated in the environmental scanning, the firm has been able to place itself in the industry as a provider of quality coffee winning the hearts of millions of clients around the world. By coming up with alliances with key coffee producers and other retailers in the market and getting new entrants, Starbucks has been able to expand and consolidate its position in the market in the recent years. Hence, this paper aims at discussing the strategic implementation of Starbucks as well as an evaluation and control of the firm.

Strategy implementation

International Strategy

Even as Starbucks moves into new markets globally, it has continued to build its brand by delivering the Starbucks experience. Regarding its international strategy, the firm chooses international business partners based on several factors. According to Chernev (2014), Starbucks selects partners who share common values and corporate culture, strong restaurant experience, committed human resources, dedicated to serving customers, quality brand, creativity, local knowledge, image building skills and high monetary resources. The strategy has been successful in the companys expansion to a diverse range of global markets including Hawaii, Japan, China, Lebanon, Qatar and Spain. The firm also focuses on the local customs and customers preferences (Chernev 2014). For instance, when entering in the Asian Pacific, the company was cautious and aware of the standard complaint leveled against multinational corporations from America if they fail to integrate cultural particular of foreign companies. In China, Starbucks positioned itself as a part of the neighborhood culture and included snacks for local ceremonies celebrated by the community (Wen, 2016).

Strategic Implementation

On strategic execution, Starbucks is known for offering superior goods and services. Consumers have had an unforgettable experience with the companys high-quality coffee. Harrington et al. (2017) says that the firm has also introduced a series of non-coffee drinks in the summer as a new segment in the market. On price, the main rival of the new summer beverages is Jamba Juice which specializes in smoothies. Starbucks prices its summer drinks at a reduced price. Also, the perceived benefits of the drinks to users are high (Harrington et al., 2017). Regarding distribution (place), the New Frappuccino Blended Beverages are sold directly to the consumers through its retail stores. The fact that the firm has stores in numerous locations, it is convenient for customers to buy the companys products. Besides, the company uses the easiest methods of promotion through internal advertisements within its branches such as posters, signage and other internal methods. It also does online marketing to ensure that its products are known globally.

Influence of Governance and Ethics

Starbucks has faith in completing its business morally and regularly endeavors to make the best decision, as it is essential to the success of the business. Starbucks has a Business Ethics and Compliance program which underpins Starbuck's central goal and secures its way of life and notoriety by offering assets that aid partners to settle on a moral choice at the working environment. The program progresses and circulates mindfulness materials, for example, Standards of Business Conduct. It likewise encourages legitimate consistence and morals training, researches delicate issues like irreconcilable circumstances and offers additional channels for partners to air their worries (Marques et al., 2015).

Social Values

It is the vision of Starbucks to hoist its partners, providers, customers, and neighbors to make positive change. Harrington et al. (2017) state that with its partners, coffee and customers, Starbucks believe in creating a culture of warmth and a sense of belonging where everyone regardless of their background is welcomed. The firm acts with courage and challenging the status quo as well as finding new ways of growing the company and the community. The company also strives towards being present, linking with honesty, dignity, and respect by offering its best in all undertakings, holding itself responsible.

Innovation and Diversification

Starbucks has often maintained its competitive advantage by leading innovation and diversification. For example, the company re-launched the pumpkin spice latte which is a seasonal favorite. The launch saw a visit to its stores doubled, and its national market also increased by 7 percent. The firm also capitalizes on changing consumer preferences. Its flexibility has allowed it to thrive in tight tea drinking markets like China (Qian et al., 2016). The introduction of almond milk and other non-diary alternatives like coconut and soy milk has made it continue to maintain its position in the market.

Legal Limitations

According to the companys website, Starbucks looks forward to presenting accurate information to its corporation sites. It reserves the rights to change or modify its terms of policy. Also, the accounts are intended to be used by anyone who is 13 years and above. However, those between 13 to 18 years must be supervised by their parents. The company has a privacy policy, site disclaimer and Starbuck cards which allow consumers to shop through their websites (Peterson, 2016).

Evaluation and control

Strategic Metrics

Starbucks stock went down with around 15 percent in the 2015/2016 financial year. However, the first and second quarter of 2017 saw improvements in the earnings report. The following are some insightful metrics from the report (Roberts et al., 2017).

Chinas sales went up by 6 percent while the metric was down from Q3 which highlights optimism of growth in the Chinese market (Wen, 2016). 16 percent of Starbucks revenue went up by 16 percent as compared to Q3-a significant acceleration compared to the third quarter which had growth revenue of 7 percent. Also, there is the aggressive expansion where 690 new stores were opened during the quarter, making the total number of stores to 25, 085.

Financial Ratios

Annual Income Statement (values in 000's)

Period Ending: Trend 10/2/2016 9/27/2015 9/28/2014 9/29/2013

Liquidity Ratios

Current Ratio 105% 109% 137% 102%

Quick Ratio 74% 73% 101% 81%

Cash Ratio 50% 44% 61% 40%

Profitability Ratios

Gross Margin 60% 59% 58% 57%

Operating Margin 20% 19% 19% 2%

Pre-Tax Margin 20% 20% 19% 2%

Profit Margin 13% 14% 13% 0%

Pre-Tax ROE 71% 67% 60% 5%

After Tax ROE 48% 47% 39% 0%

Bottom of Form

Table 1.1 Starbucks financial ratio (Nasdaq, 2017).

The financial ratio implies that the company can meet its short-term financial obligations such as debts. The firm had an unhealthy financial situation especially in 2013. From the ratio, the liquidity went down, and the profit was relatively down. However, 2014 and 2016 have been good years for the firm since it used its assets efficiently (Nasdaq, 2017).

In conclusion, Starbucks has a highly respectful culture of the countries it operates. Through its strategic planning, it has been able to sell a lifestyle to both the consumers and the workforce. The company has placed a strategic business plan for expanding to international regions. The companys key strategy is partnering with organizations that share in its culture and values as well as putting the customer above everything else. Also, the financial ratio indicates that the firm is not doing well but stable.



Chernev, A. (2014). Strategic marketing management. Cerebellum Press.

Harrington, R. J., Harrington, R. J., Ottenbacher, M. C., Ottenbacher, M. C., Fauser, S., & Fauser, S. (2017). QSR brand value: Marketing mix dimensions among McDonalds, KFC, Burger King, Subway and Starbucks. International Journal of Contemporary Hospitality Management, 29(1), 551-570.

Marques, J., Camillo, A. A., & Holt, S. (2015). The Starbucks Culture: Responsible, Radical Innovation in an. Handbook of Research on Business Ethics and Corporate Responsibilities, 302.

Nasdaq, (2017). Starbucks Company Financials. Retrieved from:

Peterson, E. A. (2016). Starbucks, trademark law and the exit 6 incident. Southern Law Journal, 26(2), 251.

Qian, Y. A. N. G., & Xing, T. U. (2016). Starbucks VS Chinese teaStarbucks brand management strategy analysis in China. International Business and Management, 12(1), 29-32.

Roberts, J. H., Srivastava, R., & Morrison, P. D. (2017). 3 strategic marketing metrics to guide pathways to growth. From little's law to marketing science: Essays in honor of John DC Little, 49.

Wen, S. (2016). Marketing strategies: Starbucks in China.


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