STARBUCKS India

SWOT Analysis Prepared By : Bhavik Makwana (37155)

Symbiosis institute of Business Management ,Pune

26th November ,2014 Advance Service

Operations Management

STARBUCKS HISTORY Starbucks is the largest coffee house company in the world, with stores in 64 countries. It was founded by a trio Jerry Baldwin, Gordon Bowker, and Zev Siegl in 1971. Today

Starbucks not only has become a global brand but also has reached revenues of $ 14.89 billion, reported for the year 2013.

STARBUCKS STRATEGY Starbucks echoes Premium Price for Premium Product. Starbucks employs value based pricing to maximize profits. Value based pricing is all about customers. To consumers,

price is a numerical evaluation of how much they value what you are selling. Starbucks also uses research and customer analysis to formulate targeted price increases that

capture the greatest amount consumers are willing to pay, without driving them off. Profit maximization is the process by which a company determines the price and product

output level that generates the most profit. With help of Lean Operating Strategy, Starbucks was able to achieve minimum wastage and maximum profit. Also, Starbucks

marketing mix consists of 4P's and 4C's viz., 4P's - Product, Price, Place, Promotion; and 4C's - Customer Solution, Customer cost, Convenience, Communication.

Tata Starbucks Ltd is a 50:50 joint venture company, owned by Starbucks Corporation and Tata Global Beverages that owns and operates Starbucks outlets in India. The outlets

are branded Starbucks "A Tata Alliance". Starbucks, through an agreement with Tata Coffee, serves coffee that is 100% locally sourced and roasted.

LOCATIONS

As of July 2014, Starbucks operates 59 outlets in 7 cities of India.

State/Region City No. of Outlets

Delhi New Delhi 14

Delhi NCR Gurgaon 4

Maharashtra Mumbai 23

Pune 6

Karnataka Bengaluru 10

Tamil Nadu Chennai 1

Telangana Hyderabad 2

SWOT:

SWOT analysis for

Starbucks India

Competitors

Strengths

Strong Brand Equity World wide

Largest coffeehouse chain in the

world

Brand image with The Starbucks

Experience

Opportunity for growth in Mini-

metros

Backing of TATA beverages

infrastructure

Loyal customer base

Has a lot of new flavour variation

Limited no of strong competitor

Employee management

Weaknesses

Higher price

New market for Starbucks

Negative corporate image

world-wide

Indian coffee culture is different

form American European

culture

Self-cannibalization through

more penetration

Absence of Salted items in

menu ( Which might matter to

Indian consumers)

Opportunities

Growing consumerism in India

Very less players in India with

focus on Experience

Product innovation and new

growth platforms

Extended supply range

New distribution channels

Changing customer base across

country

Threats

Growing competition within the

coffee industry (Eg Caf Coffee

Day, Coffee Culture, Barista

Lavazza etc.)

Strong presence of Local Brands

in target cities

Supply and price of coffee is

subjected to volatility

Changes in government policies

Change in population age (Long

term)

COMPETITION:

CONCLUSION:

Although Starbuck is well known all over the world for its premium service , customer in India wants coffee at relatively low price which has been a concern for company in India

.But as Indian youth is experiencing the model they are becoming more and more accustomed with Starbucks. With opening of two new Outlets in Bengaluru this year, Starbucks

has made its position strong which will continue to grow as long as there are less number of players in this premium segment.

REFERENCES:

http://seattletimes.com/html/specialreportspages/2020216020_starbucks-coffee-in-india-part-one.html

http://www.starbucks.in/about-us/company-information

http://blogs.ubc.ca/nadirsurani/2012/11/13/starbucks-is-in-india/

http://www.iluvstarbucks.com/

http://en.wikipedia.org/wiki/Tata_Starbucks