From early 2009, Starbucks had nearly 17,000 stores worldwide, with approximately one third of them outside the United States. Despite multibillion-dollar annual sales, the giant coffee retailer’s annual growth rate was decreased by half, quarter profit had fallen as much as 97 percent same-store sales were negative, and the share price was languishing. Factors such as a global economic downturn and increased competition in the specialty coffee market from big players like McDonald’s and Dunkin ‘Do … Read more »

From early 2009, Starbucks had nearly 17,000 stores worldwide, with approximately one third of them outside the United States. Despite multibillion-dollar annual sales, the giant coffee retailer’s annual growth rate was decreased by half, quarter profit had fallen as much as 97 percent same-store sales were negative, and the share price was languishing. Factors such as a global economic downturn and increased competition in the specialty coffee market from big players like McDonald’s and Dunkin ‘Donuts had driven this decline, which planned the deaths of hundreds of domestic branches already, many others are. Founder Howard Schultz, who had recently returned as CEO, and his management team were convinced that Starbucks was the growth opportunities abroad, where the company already has a strong position in markets such as Japan and the United Kingdom and prepared hundreds of new stores Open in a variety of locations. But the recent international challenges, including the closure of most Australian stores made clear due to sluggish sales that Starbucks to learn more about bringing its value proposition-a combination of premium coffee, superior service and a had “coffeehouse experience” on foreign soil . The crucial question was not whether Starbucks could convey its value proposition overseas, but as the value proposition three elements would be entered lately and playing new markets. And the stakes, the right international trains increased with every U.S. store closing. Schultz and his team also faced a broader question, one that applied to both their U.S. and foreign branches: Could they “grow remain large and small,” a huge remaining retailers, both high quality products and a consistently intimate and pleasant experience to provide consumers worldwide? This case addresses this challenge in the context of the Starbucks story, well-established value proposition, as well as national and international growth and vision.
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from
Richard Honack,
Sachin Waikar
Source: Kellogg School of Management
22 pages.
Release Date: 1 December 2009. Prod #: KEL447-PDF-ENG
Growing Big While Staying Small: Starbucks harvests International Growth HBR case solution

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