Global business environment case study for Starbucks1Word文件下载.docx

Global business environment case study for Starbucks1Word文件下载.docx

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FromaSeattle-basedcoffeeshop,StarbucksCompanyexpandedatitsfastestspeedto17000storesin55countriesbytheendingof2011.Thefirstforeigninvestmenthappenedin1996whenStarbucksestablishedjointventureinJapan.Inthefollowing16years,varietystrategiesareusedinexpandinginternationalmarket:

licensing,jointventure,wholly-ownedsubsidiary.China,asStarbucks'

nexttarget,willbetriplesizedthescaleinnextthreeyears.ThisessayanalysesandillustratesStarbucks’expansionactivitiesandstrategicdecision-makingbasedonDunning’sEclectictheory（1980）andFriedman'

sninequestions.

Dunning’sEclectictheory（1980）

Dunning’sEclectictheoryisafruitfultheorythathelpsfirmstodetermineFDIactivitiesandchoosethecorrectmodetoenterinternationalmarket,whichstandsforownership,locationandinternalization.

Ownershipadvantagereferstothesuperiorassetsandskillsthatafirmpossesses,whichareinaccessiblebyrivalsinthehostmarket.

Beingtheleadingcoffeeretailerandroasterformorethan40years,Starbuckshasitsmostsignificantinvisibleadvantage--brandandreputation.Thegoodreputationwasbuiltupbyitsexcellentqualitycoffeeandgoodcustomerexperiencethatisbeneficialforcompanylong-termdevelopment.Moreover,Starbuckshasefficientcoffeebeansupplychain,combiningwithquickR&

D,distributionchannels,whichhighlyaddvalueinitsvaluechain.Additionally,Starbucksbuildsaperfectsocialimage,withcontributioninmanyareas:

community,ethicalsourcing,environment,wellnessetc,whichattractscustomerswithenvironmentalandsocialawareness.

Locationadvantagesareadvantagesforfirmstoexploititsassetsinforeigncountriesorregionsratherthandomesticplaces.Itusuallyincludesexistenceofrawmaterial,lowwages,specialtaxesortariffs.（Gray.H.P,2003）

Theycanbedividedintotwoaspects:

marketadvantagesandgovernmentsupport.AccordingtothedatafromChinaCoffeeAssociation,theannualgrowthofcoffeeconsumptionisaround15%,whiletheworldcoffeeconsumptionincreasesonlyby2%eachyear.AttractedbytheChina'

slowcostandsoardemandofmostpotentialmarket,Starbucksplannedtriplesizedthescaleinnextthreeyears,andthemostnetstoresopenedinChinaatthenumberof58（AnnualReport,2005）.Furthermore,Chinesegovernmentsetupseveralbeneficialregulationstoattractinvestments:

lowtax,largeinvestarea,freeland,financialsupport.

Internalizationadvantagegivesthereasonwhythefirmhaswillingnesstointernalizecross-borderstructure.（Dunning,J.H.,&

Lundan,S.M.2008）

Fromtheinitialpurposeofsellingthefinestwholebeancoffeesandcoffeebeverages,Starbuckscontrolscoffeepurchasing,roastingandpackaging,andtheglobaldistributionofcoffeetoensurewhatitsellsiscompliancewiththerigorouscoffeestandards.Moreover,StarbucksoperatesFarmerSupportCenters,whicharestaffedwithagronomistsandsustainabilityexpertstoworkwithcoffeefarmingcommunitiesinordertopromotebestpracticesincoffeeproductiondesignedandimprovebothcoffeequalityandyields.Thisactionnotonlyhelpsensuresustainabilityandfuturesupplyofhigh-qualitygreencoffees,butalsoreinforcestheleadershiproleinthecoffeeindustry.

Friedman9Questions

HowFastIsYourCountryorCompany?

The‘Fast’ofStarbuckswillberecognizedasthreefollowingparts:

1）FastinR&

Dnewgenerationofproducts;

2）Fastdistributionbusinesstotheworldaswellasfastindestroyinginefficientbusiness;

3）Fastinrespondingtocustomers’commentsandideas.

1.Starbucksisalwaysseekingtodevelopmarketshareandunderpinitscustomers’loyalty.ItputsenormousenergyinR&

Dandlaunchesnewproductstomeettheexpectationsofcustomers.Forinstance,inthefirsthalfyearof2010,Starbuckslaunchedthreenewproductstosatisfycustomersinaccordancewithspecificseasonalrequirementandhealthyissue.Comparedwithquick-servicerestaurantsandspecialtycoffeeshops,Starbucks’productdevelopmentisfarquickerthancompetitors.（StarbucksPress,2010）

2.Starbuckshadarapidgrowthfrom2000to2008;

italmosttripledthenumbersofstoresinternationally.Starbucksexecutedmanagers’strategieswelltoexpandworldwidemassivelyinsuchashortterm.However,problemscamewithover-expanding.In2008,itcloseddown600storesintheUSduetocannibalizingeffectsandstrongcompetitionfromMcDonald’sandDunkin’Donuts.AlthoughitwasadilemmaforStarbucksatthattime,itmadetimelydecisionstoshutinefficientstores.

3.Starbucksconcentratesonmarketingcommunicationstrategies,whichhelpcustomerstobeabletooutpourtheirsuggestionsandshareexperienceswitheachotherviaallkindsofpossiblechannels.OneofStarbucksmemberhassummarized6reasonstoprovewhyStarbuckshasbeendoingsowellinmarketingcommunication.Starbucksiskeepingdoingitsbesttorespondcustomersasfastaspossible,sothatitmakescustomersfeellikethatStarbucksiswiththemanywhereanytime,likemobilephones.

IsYourCountryorCompanyHarvestingItsKnowledge?

Thecompetitionforthebestinformationhasreplacedthecompetitionforthebestlocationandmanagerforcompaniesnow.InformationnetworksareextremelycrucialtoStarbucks.Procurementteamworkswellingatheringinformationfromsuppliersworldwidetoensurethequalityofcoffeebeans.Starbucksonlypurchasecoffeebeansfromreliablesuppliersandwellmanagetheinventorylevelinordertohandthebestcoffeetocustomers.Moreover,aswementionedabove,themarketingteamhasatremendouswide-rangecommunicationnetworkwithcustomers.Theytakefeedbacksfromcustomersseriouslyviaanypossiblechannel,comparinginformationwithcompetitorsinthemarket,andfinallymakedecisionsofmarketingstrategies.Starbucksdobenefitalotfrommanaginggoodnetworksofinformation.

HowMuchDoesYourCountryorCompanyWeigh?

Starbucksisalightcompanyratherthanaheavyone,becauseitcontrolsintensiveinventorylevelsofcoffeebeansandfoodstuffinordertoguaranteethebestqualityoffertocustomers.

DoesYourCountryorCompanyDaretoBeOpenontheOutside?

Starbucksismorethanhappytoopenontheoutside;

theyarepleasedtoreceivecriticismfromcustomerswhowillhelpthemtothinkabouthowtoproducebetterproductsorhowtochangecurrentproductstomeetcustomers'

expectations.

DoesYourCountryorCompanyDaretoBeOpenontheInside?

'

Inside'

generallymeanshowtransparentthebusinessisfrominsideofthecompany.AccordingtotheresearchbyGoodGuide,seebelow:

ENVIRONMENTAL

PERFORMANCE

SOCIALPERFORMANCE

Transparency

7.3

6.9

Environmental

Management

6

6.2

Governance

6.7

Policies

Reporting

7

SupplyChain

ComplianceandControversies

4

LeadingEdgePractices

10

8

3

ResourceUse

6.8

Workers

5.2

GeneralResourceManagement

General

Materials

6.5

OccupationHealthandSafety

Water

DiversityandEqualOpportunity

Energy

HumanRights

5.5

EnvironmentalImpacts

6.1

GeneralHumanRights

5

Biodiversity

FreedomofAssoc.&

Collect.Bargaining

4.5

Emissions

ChildLabor

GeneralEmissions

ForcedandCompulsoryLabor

GreenhouseGases

7.5

IndigenousRights

CriteriaandHazardousAirPollutants

Community

WaterPollution

PublicPolicy

Waste

StakeholderEngagement

CommunityRelationships

Consumers

5.3

ProductandServiceLabeling

Starbuckstransparencyisratedrelativelyhigherthanaverageinbothenvironmentalandsocialaspect.

DoesYourCountry'

sorCompany'

sManagementGetItandCanYouChangeManagementIfTheyDon'

t?

Thisisabouttheveryinternalinformationthatwedonotknowfromthegeneralchannels.Thus,wehavenocommentsonthisquestion.

IsYourCountryorCompanyWillingtoShootItsWoundedandSuckletheSurvivors?

After2008,theStarbucksseemedtostruggletodealwithitsdecreasingbusinessperformances.'

Starbuckshasbeenhurtbyrisingcosts,thecannibalizingeffectsofyearsofover-expansion,andstiffcompetitioninespressodrinksfromMcDonald'

sandDunkin'

Donuts.'

（11/11/2008,NewYorkTimes）Theyhadtodecidetoclosedown600storesintheUSin2008.TheStarbucksCEOHowardSchultssaid:

'

Wehadtoadmittoourselvesandtothepeopleofthiscompanythatweownedthemistakesthatweremade.'

Starbuckshavethespiritstoencouragethedestructionofestablishedbusiness.AswellastheyalsoaimtoanewmarketforfuturedevelopmentinChina.StarbuckspostedasignificantgrowthinChinaoffiscalfourthquarterin2012.Itsrevenuerose11percentmeanwhiletheprofitincreased24percent.（Strom,S.2012）

HowGoodIsYourCountryorCompanyatMakingFriends?

ThereisnodoubtthatStarbucksisgoodatmakingfriends.TherearethousandsofstoresopenworldwidesellingStarbuckscoffees.Thesestoresaremainlyeitherlicensedorjointventure.Starbuckshasalliancesallovertheworldsupportingitsfastexpandinginternationally.

HowGoodIsYourCountry'

sBrand?

Starbuckshasabrandpersonalitythatdeep-rootedincustomers'

minds.Starbucksallovertheworldshavethesimilarelegants