Answering questions for case study Essay Example | Topics and Well Written Essays - 1000 words

Answering questions for case study - Essay Example Starbucks capabilities are a combination of innovation, ownership, talented employees, merchandising, image building, and retailing. 2. Today, Starbucks have to leverage its resources and capabilities to achieve growths in the retail sales by expanding consumer base and market opportunities. To start with, Starbucks needs to consider its financial standing which currently does not support rapid expansion. Continuing with joint ventures and relying on their network of distribution and marketing would be a wise decision. But since Starbucks core business model is dependent on retail outlets and property ownership then it would be prudent to extend its brands through expansion in the brick-and-mortar environment. Starbucks has the option to develop its growth through increased presence in new markets or transfer its technology through franchising. I would suggest that Starbucks take on franchising partly and continue with expansion on its own. For example one main store in a country with franchises in smaller urban settings. This would ensure that increased baristas without expensive investment in human resources, property, marketing, and logistics without losing the essence of its organizational culture, standards, values and business strategy. Alternatively, if Starbucks continue to expand with its own investment by planting stores in new and emerging markets, in the long term it would have more investment returns and values, but slowdown on achieving strategic objectives. 3. Given the market conditions of the specialty coffee and mushrooming of coffee houses and bars, I would not respond to McDonalds offer. This is because 1) the McDonalds brand is associated with low-price food solutions whereas Starbucks has established itself as high priced specialty coffee distributor and provider of high quality coffee experience; 2) because McDonalds offer means channeling into the basic coffee market whereas Starbucks needs to concentrate on the