Starbucks
Overview
Starbucks is an international company that has over 28,000 stores in about 75 different countries (Bean-Mellinger, 2019). While largely known for their coffee beverages, Starbucks also creates and distributes a variety of premium teas (hot and iced), and a large variety of sandwiches and snacks. Starbucks is a company that is dedicated to “inspire and nurture the human spirit – one person, one cup, and one neighborhood at a time,” as directed in their mission statement (Culture & Values, n.d.). Starbucks is a company that continues to develop and refine their customer experiences by updating and refining their rewards program.
I propose to continue to enhance customer loyalty by developing Starbucks Catering options in select stores. Many of Starbucks current locations already offer a variety of food options for breakfast and lunch; my idea would not only build upon their current rewards members, but potentially add more at a higher rate. The catering service would be available to Starbucks Rewards members, and allow these members to acquire “Stars” for catering services to be used for later benefits. It is my intention to show that by offering a catering service to current Starbucks Rewards customers, it will increase brand awareness, as well as increase customers signing up for the current Rewards programs.
When creating or updating a business plan or idea, a company needs to have a strategic marketing plan in place. To aid in this, a SWOT analysis is conducted to identify the business ideas’ Strengths, Weakness, Opportunities and Threats. This analysis helps define what supports the business in accomplishing its objectives, and what barriers there may be to mitigate or reduce in order to achieve anticipated outcomes; it starts by analyzing where the business is in current moment, and where it will be in the future (Grant, 2020). A SWOT analysis looks at internal (strengths and weaknesses) and external (opportunities and threats) forces that have an impact on a business and the business idea and can be represented in various different visual ways to help the business better understand how to proceed (Grant, 2020).
In addition to completing a SWOT analysis, businesses need to focus on their core competencies. A core competency for a company is something the business excels at. Starbucks for example is known for having quality roasted coffee and specialty drinks. The types of coffee beans they procure, how they roast the beans, and how they hand-craft each specialty drink for customers is a signature to the company. A firm’s core competencies are difficult for its competitors to mimic, allowing the company to differentiate itself (Kenton, 2020).
SWOT Elements: Assess
SWOT Analysis | |
STRENGTHS |
· Strong Brand Image / Brand Loyalty
· Global Presence · Quality, Taste and Standardization (Uniformity) · Employee Benefits · Cultures and Values · Strong Financial Performance |
WEAKNESSES |
· High Price Points
· Recalls of Products / Allergens · Starbucks “C.A.F.E.” vs Fair Trade · Increased Costs and Overhead to start Catering |
OPPORTUNITIES |
· Partnership / Alliance with Other Businesses
· Breakfast and Lunch options available to expand on · Increase of Starbucks Rewards Customers |
THREATS |
· COVID-19 / Store Closures
· Competition with other bigoutlets (Dunkin Donuts, McDonalds, Panera) and local smaller coffee shops · Company’s Policies during Black Lives Matter Movement / Media Backlash o Cancel Culture |
Strengths
One strength of Starbucks is the brand’s image and recognition. Starbucks has maintained a strong position globally in the coffee market. As Starbucks is a global brand in various markets, consumers all over the world can recognize the Starbucks mermaid logo when travelling. This is important to Starbucks because it also creates brand loyalty – Starbucks customers come to recognize the standardization, quality and taste that they get when they’re visiting a Starbucks in one location versus another.
Starbucks offers both part-time and full-time employees with health insurance, stock options, a 401K, paid time off, parental leave, and so much more (Benefits and Perks, n.d.). This is a great strength for the company, as the introduction of a Catering service could open up additional opportunities for people who are looking for employment. As more and more people are being let go from jobs due to the Covid-19 pandemic, Starbucks can come back strong and assist their communities by providing jobs in both their coffee shops as well as catering positions once established. Starbucks has also developed the “Opportunity Youth” where they commit to hire 100K people between the ages of 16-24 years old who are not otherwise working or in school. In 2015 to 2018 they hired 100K of these youths, and in 2017 they committed to hire another 100K by 2020. As of January 2019 they had hired over 75K (Community, n.d.). While COVID-19 may have slowed the hiring process, Starbucks continues to operate at 80% of their transactions being “on-the-go” occasions and they are reexamining the U.S. store footprint with a vision to evolve the Starbucks retail presence over time through targeted store renovations, relocations and new stores and creating a new, elevated experience for partners and customers (Navigating, n.d.).
Financially, Starbucks is still in a very good position. While global comparable store sales declined 10%, driven by a 13% decrease in comparable transactions, partially offset by a 4% increase in average ticket, Starbucks opened 255 net new stores in Q2, yielding 6% year-over-year unit growth, ending the period with 32,050 stores globally, of which 51% and 49% were company-operated and licensed, respectively (Starbucks Reports, n.d.). Starbucks also reportedconsolidated net revenues of $6.0 billion declined 5% from the prior year due to lost sales related to the COVID-19 outbreak where lost sales include the effects of temporary store closures, modified operations, reduced hours and reduced customer traffic (Starbucks Reports, n.d.). Starbucks continues to believe that the impacts of the COVID-19 outbreak are temporary and that the business will fully recover over time (Starbucks Reports, n.d.). Starbucks continues to protect the health and well-being of our partners and customers, and have temporarily closed stores globally, as well as following all guidelines provided to them by various governments in order to slowly begin to open back up.
Weaknesses
Starbucks is a company that is not without its own weaknesses. Starbucks pricing can be at the higher end for some consumers, and the high prices can reduce the affordability for even those in the target demographic for the company. Starbucks higher prices for their coffees and drinks can get expensive fast the more complicated your beverage gets. However, Starbucks can combat this weakness with the consistency and quality of their beverages. Unlike Dunkin’s, which many locations are franchised, Starbucks locations that are not corporate owned, are licensed. This leads to a consistency and quality of a beverage that consumers can depend on; if a location that licenses the Starbucks location does not meet the quality of standards of corporate stores, they can no longer use the brand logo. Customers understand that the higher price-point of the coffee, offers them a quality and consistency that you might not receive from other places.
Another weakness of Starbucks that can greatly impact the Starbucks Rewards Catering is the recent (2016) recall of some of their food items. One of the food manufacturers for Starbucks, Progressive Gourmet Inc., that makes the breakfast sandwiches, discovered in a routine check that some of the items were potentially contaminated with listeria (Sterling, 2016). These breakfast sandwiches were distributed to 250 stores in the United States, and were immediately recalled once Starbucks learned of the problem (Sterling, 2016). In addition to the recall of some potentially contaminated breakfast sandwiches, the “Cheese & Fruit Bistro Box” was reported to have almonds that contained “undeclared cashews” that were not listed on the “allergens” for the food items. This product was also immediately recalled from the stores in Washington state where they were distributed (Sterling, 2016). These recalls, while occurring 4 years ago, can still be a potential weakness for Starbucks when they are trying to roll out a Catering service. It is very important for a company to be informed of all potential contaminants or allergens in their food and beverage items, as they can be seriously life threatening to people if consumed. It would take just one consumer to ingest a product from a company and have a serious allergic reaction for the company to face potentially costly litigations, damaging media coverage, and lose the trust of consumers. In order for Starbucks to safeguard against these issues, the company will have to continue to do its due diligence in where they source their food items and ensure that these businesses are also continuing to check for potential contaminants and allergens.
Starbucks is a company that strives itself on being ethical and motivated to do what is right for the success of the business and their consumers.One weakness identified by consumers is the lack of Fair Trade practices that Starbucks uses in order to source their coffee beans. Starbucks has created their own CSR (Corporate Social Responsibility) code, and “C.A.F.E.” practices (Coffee and Farmer Equity). Starbucks claims that C.A.F.E. “practices standard for ensuring that Starbucks is sourcing sustainably grown and processed coffee. Starbucks defines sustainability as an economically viable model that addresses the social and environmental needs of all the participants in the supply chain from farmer to consumer” which “encompass a comprehensive set of more than 200 social, economic and environmental indicators. This approach takes into account everyone from the farmer to the consumer” (Starbucks C.A.F.E. Practices, n.d.). Starbucks continues to utilize the C.A.F.E. Practices as a verification program, not a certification. Farms and mills are still evaluated by third-party verification organizations overseen by SCS Global Services, but we use this information to focus on improvement. Starbucks has also begun to invite other businesses in the coffee industry, including competitors to review and adopt C.A.F.E. Practices to continue to improve best business practices for the coffee industry as a whole (Starbucks C.A.F.E. Practices, n.d.). If Starbucks can begin to align C.A.F.E. practices closer to those of Fair Trade (or better than), and continue to be transparent with consumers, they may be able to minimize these practices as perceived weaknesses.
One weakness specific to opening Starbucks Catering would be increased overhead costs to certain locations. Starbucks will have to hire additional staff in order to accommodate the additional orders. Starbucks would also have to ensure that employees that work with the catering aspect of the company have valid licenses and the ability to transport the catering to and from the specified office locations. Starbucks could choose to have these employees be baristas who are also trained in the catering aspect of the business, or have these staff be separate from the baristas in the “front end” of the business. Initially this could be costly to Starbucks in order to hire and train employees on this service, as well as any additional insurance that would be needed on the business behalf for providing catering. Individual Starbucks management staff would also have to decide on how many specific types of catering orders they are able to accommodate on any given day, in order to ensure they can accurately maintain stock of food and beverages for both the main Starbucks business and the catering service. Additional overhead costs could come in the form of needing to open up catering specific locations if current store locations cannot accommodate the additional food and beverages offered for catering, and target areas have many office buildings that would benefit from the catering services.
Opportunities
Starbucks already offers breakfast and lunch options to their customers, a great opportunity for the company would be to leverage these items and purchase in greater quantities to serve for catering. Starbucks currently sources from various vendors and distributors in many different locations; Starbucks could partner with larger distributors in order to continue with brand consistency for what they offer in catering services, or the company could continue to utilize their distributors in these locations and offer unique menu options per region. By leveraging their current relationships with their food distributors, Starbucks can potentially lower the costs of buying more food items in bulk for their various locations. Starbucks Catering could also develop a partnership or alliance with other businesses.
If there is continued success with the partnership, there could be an opportunity for an acquisition for Starbucks. La Boulange, a bakery chain in the San Francisco area, was a company that Starbucks acquired in 2012. La Boulange products were initially sold in both Starbucks locations, as well as independent La Boulange stores until the independent locations were closed by Starbucks (Reiff, 2020). Starbucks still sells La Boulange products in their own Starbucks retail stores, so a partnership or acquisition of other bakery or small chain lunch retailers could help boost the amount of food Starbucks is able to produce in order to support the catering services.
Currently, Starbucks has partnered with UberEats in order to deliver food and beverages to consumers. This partnership is extremely beneficial for Starbucks to evaluate how they can begin to provide catering services. Starbucks can send surveys to their UberEats customers on how timely their products are delivered with UberEats, as well as how fresh their food and beverages are upon delivery. By collecting data on customers utilizing the UberEats program, Starbucks can begin to evaluate how effective delivery of their products are, as well as make any necessary changes. One way Starbucks can improve on the UberEats program would be to have their own delivery trucks that specialize in transporting food; UberEats are regular cars that Uber drivers own to transport food and people. By collecting data from UberEats customers, Starbucks will be able to estimate delivery times in local areas during peak times, assess consumer practices when ordering delivery, and begin to calculate the overhead costs of gas, and additional personnel in order to deliver the catering.
Introducing a Starbucks Catering program would be a great opportunity for Starbucks. By attaching the Catering program to the existing Rewards program, Starbucks can utilize their already large consumer base as a starting point for marketing and business. Additionally, current Rewards members will be the “word of mouth” marketing for the company; people who may go to Starbucks occasionally, and not be a Rewards member will have to become a Rewards member in order to get the Catering services. This will increase memberships for the current Rewards programs, which can overall increase sales for the company as more people appreciate the benefits they receive being a Rewards member.
Threats
As always, company rivalry is always a threat to businesses. Main competition currently for this coffee/beverage business is Dunkin’s (formally known as Dunkin Donuts prior to re-branding), as well as Panera. In addition to the larger coffee chains, smaller “mom-and-pop” type locations are gaining more support from Starbucks target demographics of GenX, Millennials and “Zoomers” also known as Gen Z. Local, smaller coffee shops also tend to be more active in their immediate communities, by hosting events, introducing local artists (music and physical), and hiring people within the local communities. When given a choice to shop locally versus a larger corporation, Starbucks demographics are now more conscious with their wallets and are more willing to “shop small.” Local coffee shops, while they can be equally as pricy as a cup of coffee from Starbucks, tend to offer a more “laid-back” and “home town” atmosphere, in addition to offering various new items on the menu as they often pride themselves on the excellent quality of their creations (Wallace, 2019).
Another threat for Starbucks would be competition from local Panera’s in the area, as they currently offer not only delivery in some areas, but catering services as well. This could prove to be particularly difficult for Starbucks to break thru in areas that also have Panera available for deliveries in those areas. However, by continuing to research how companies like Panera offer delivery and catering services, Starbucks could adopt and improve upon these efforts to be successful. With more companies currently partnering with businesses like UberEats, GrubHub and DoorDash to deliver their products (more frequently now that Covid-19 shut down access to go into locations), more companies may begin to develop their own delivery services in the future.
One of the greatest threats facing most businesses today is the Covid-19 pandemic. As Starbucks is a global company, this has affected store closures in many companies; most notably half of their stores in China. In March of 2020, Starbucks announced that it was investing over $130M in China to open a state-of-the-art roasting facility in 2022 as part of its new Coffee Innovation Park (CIP) (Starbucks China, n.d.). This development in China would be Starbucks’ largest manufacturing investment outside of the United States, and the first in Asia. Presently, Starbucks operates six other roasting facilities; five in the United States, and a facility in Amsterdam to support their European markets. The warehouse, roasting and distribution capabilities of the CIP will lay a strong foundation for continued business growth and development in China (Starbucks China, n.d.). As Covid-19 originated in China, and hit the country hard, Starbucks had to close nearly half of the stores temporarily due to the pandemic.
The Covid-19 pandemic is still an ongoing issue that is affecting the world, and Starbucks has to navigate not only various countries and their policies, but in the United States, many states vary on how they are handling the pandemic. Many countries temporarily had mandatory shut downs and quarantines for their citizens, some lasting over a few weeks, in hopes to flatten the curve of the virus spreading. The United States was late in acting and has steadily increased cases in the country. Many states in the U.S. continue to differentiate on how they are handling business shut-downs, quarantines and re-opening their locations; without a federal mandate in place, Starbucks is forced to navigate through many state mandates and develop a plan that best fits their company as a whole.
Another threat to the company is media backlash over perceived indifference over social justice issues such as the Black Lives Matter movement. When #BlackLivesMatter came into trend on social media platforms, there were many Starbucks employees that were wearing masks and paraphernalia in support for this movement. The lack of communication with the Starbucks corporate offices and store locations resulted in mixed messages when employees were told they were not allowed to wear these slogans / show support while at work. In an earlier memo, Starbucks said it won’t allow employees to wear “Black Lives Matter” material because “there are agitators who misconstrue the fundamental principles of the ‘Black Lives Matter’ movement — and in certain circumstances, intentionally repurpose them to amplify divisiveness” (Valinsky, 2020). This caused a lot of backlash from not only employees, but patrons as well, citing that not supporting the black community or listening to what the BLM movement is about, and by not allowing employees to show support, does not fall in line with the company’s cultures and values. ). Within hours of Starbucks employees posting their experiences with being told they were not allowed to wear those statements in the stores, social media campaigns to #boycottStarbucks began trending. After a few days of being publically called out by employees and patrons, Starbucks reversed their initial decision and said it’s “critical to support the ‘Black Lives Matter’ movement as its founders intended and will continue to work closely with community leaders, civil rights leaders, organizations, and our partners to understand the role that Starbucks can play, and to show up in a positive way for our communities” (Valinsky, 2020).In today’s society “Cancel Culture” can be very detrimental to a company, even one as large as Starbucks. When a friend of mine discovered that Starbucks original opinion on wearing #BlackLivesMatter paraphernalia for employees was not allowed, she felt that Starbucks “flip-flopped” on the issue and felt it went completely against the company’s cultures and values. She has since made it a point to try and get her coffee and snacks at smaller, local coffee shops in the near future, because she stated she had a difficult time in supporting a company that could not take a strong stance in favor of equality from the very beginning. More and more of Starbucks’ target demographics are in the “social justice warriors” demographic, where these issues are extremely important to them, and they are willing to call out companies who misstep.
Strengths, Weaknesses, Opportunities: Consumer Trends
One thing Starbucks continues to do is update their customer loyalty program “Stars” for consumers. The “Stars” loyalty program is tied to a Starbucks card, or one of their Starbucks Visa cards, as well as the Starbucks mobile app. Customers earn “Stars” by making purchases, and can redeem them for a variety of options, whether it be earning a specific amount for a free customized drink, extra shot of espresso, or even a lunch item. Starbucks prides itself in remaining a sustainable company to reduce the environmental impact of their stores (Sustainability, n.d.). Currently, customers earn 2 “Stars” for each dollar spent on purchases; with Starbucks catering, customers will have the opportunity to earn even more “Stars” to use towards future catering options, or in store for their own purchases. It is very easy to join the Starbucks Rewards program, all a customer has to do is have a Starbucks card (typically people get these as gifts, but they can purchase them individually for themselves as well). Customers then just need to register the Starbucks card online or through the mobile-app. After the card is registered, customers can use the card via the mobile app, or in person to make purchases and begin earning rewards. If a customer has multiple Starbucks cards with various amounts on them, they have the option of combining the cards through their Starbucks mobile app, online, or having a Starbucks barista combine the cards for them (Starbucks Rewards, n.d.). Current Rewards members would be the customers who benefit from the catering service, and by word-of-mouth they would provide additional marketing for Starbucks. By introducing a catering aspect to their Rewards program, Starbucks could see an increase of Starbucks Rewards members.
Another industry trends that could impact Starbucks is the rise of the prices of coffee beans world-wide. According to Reuters, they believe the price of Arabica beans will rise by nearly 25% above current levels by the end of 2019 (Volkman, 2019). However, per The Motley Fool’s analysis of the industry trend, the cost of beans forms only a small percentage of Starbucks’ overall costs (Volkman, 2019.). In order to combat the fluctuating prices of Arabica beans, Starbucks hedges its coffee purchases (Volkman, 2019). Hedging, for companies is similar to people purchasing insurance; you buy into insurance hoping that if needed it will cover what instances may occur, in the case of Starbucks, hedging their coffee purchases will aid them in the long run if coffee prices continue to surge (Kenwell, 2014).
While Starbucks may be in a good position for obtaining their Arabica beans at higher prices, other rising costs of food items due to Covid-19 may drastically impact Starbucks ability to even launch a catering service. The impact that Covid-19 has had on the food supply chain, from farmers, to packaging, and even transportation have been significantly affected. Retailers from restaurants and coffee shops, etc. had to suddenly stop orders after Covid-19 related shutdowns causing logistical issues in supply chains (Felix, Martin, et al, 2020). For those unaccustomed to supplying the retail channel, redirecting their sales adds the complexity of modifying their current supply chains—and that can also add to costs (Felix, Martin, et al, 2020). Due to supply chain workers at every level being “essential workers,” the spread of Covid-19 also can severely impact businesses ability to operate. If there are infected employees at any location, places need to be shut down and sanitized before employees can return, employees need to be isolated and products need to be recalled, causing increased costs that may eventually be trickled down to consumers (Felix, Martin, et al, 2020). Until there is a vaccine, or more is understood on the transmission of Covid-19, businesses need to continue to stay on top of sanitization, as well as coordinating how to ensure their supplies are delivered. Profit margins will likely be affected at each step during messy rebalancing. Companies will need to rewire for agility versus trying to achieve static optimization states (Felix, Martin, et al, 2020).
Strengths, Weaknesses, Opportunities: Ethics
One issue of ethics Starbucks has dealt with recently is with racism in their stores. In 2018, a manager called 911 on 2 black men who were waiting for another friend to arrive. The 2 men were just sitting and chatting in the Starbucks, when one asked to use the restroom. As the men had not yet ordered anything, the manager advised that the bathroom was for patrons only, and if they didn’t order anything he had to ask them to leave. When the men advised they were waiting on someone, the manager of the Starbucks began to order them to leave and that he would call the cops if they refused. The manager did call 911 to have the men removed from the store despite no crimes being committed and public opinion outrage for the blatant racism people saw from the manager. Starbucks CEO shortly after met with the 2 men directly, as well as police and local officials in the area to try and “set things right.” Starbucks then closed all stores nationwide on May 29th to conduct racial-bias education for all 175,000 employees (Danziger, 2018). One would have hoped that this racial-bias training would have helped in 2020 when the original stance from Starbucks on the Black Lives Matter movement would have been full support from the start, however that was not the case. With the rise of cultural and social responsibility from Starbucks target demographic, who are supporting movements such as LGBTQ+ rights, and Black Lives Matter, as well as many other social injustices, Starbucks will need to be in the fore-front of truly living their cultures and values. There would have never been any need for backlash over Starbucks not allowing employees to wear BLM paraphernalia, if Starbucks came out in front of the movement (similar to Ben & Jerry’s) and issued a statement of support for the BLM community, and allowing their employees to show their support as well. Starbucks still has a lot of growth to do in that department.
Another ethical issue for Starbucks was when it was reported in 2018, that Brazilian labor inspectors have found slave labor on plantations where Starbucks buys coffee; and not just any plantations, but ones that have been “verified” to Starbucks’ C.A.F.E. Practices standards (Canning, 2019). Reporting filthy living conditions, being extremely underpaid and working from 6am-11pm with no real access to bathrooms, or breaks, the Brazilian government reported that the farm that was raided held a Starbucks C.A.F.E. certification. The official response from Starbucks was that they had not purchased beans from the farm in several years. One of the C.A.F.E. verifications allow for inspections to happen as infrequently as 2-3 years, depending on several factors including previous inspection scores (Canning, 2019). While Starbucks may not have purchased beans from the particular vendor in several years, it is hard as a consumer to believe that similar practices were not occurring when Starbucks had “verified” the farm. While Starbucks’ C.A.F.E. Practices are mostly unknown to many consumers, the issues that surround the practices and how some verified farms may employ slave-labor remain something that Starbucks can hide in the “transparency” of their own reports. If consumers don’t do their own research, or those who are conducting studies to find out how many unethical sourcing is actually occurring don’t speak out louder, these practices might continue to go unnoticed or changed.
Despite the above ethical issues that Starbucks needs to continue to work on, the company does pride itself on being transparent. Starbucks has their own “Standards of Business Conduct” website for their “partners / staff,” that promote “living the values” of Starbucks. Starbucks also requests that all third part vendors that act on Starbucks’ behalf also conduct themselves in a higher standard. Starbucks’ website provides consumers with an abundance of information on how they source their products, reports on the progress of their sustainability processes, updates on climate change and how they are committed to combat it, as well as current COVID-19 information and the impact that has on the Starbucks communities. This level of transparency is somethings consumers look for in companies in today’s world. Consumers appreciate when companies can publicly address their strengths and weaknesses in areas, and show evidence of their commitment to improve on any unethical practices that may have occurred.
Strengths and Weaknesses: Affect
Starbucks has many strengths within the company, and a few weakness that have an effect on business. By introducing a new segment “Catering” to their portfolio, Starbucks can continue to outshine some of their larger competitors in McDonalds and Dunkin’s, as well as have an advantage over some of the smaller, local coffee shops in the area. They would then transition into being a bigger competitor to Panera, as they already have catering services. In order to break through and market the Catering services, Starbucks may have to open a few “test-kitchens” in areas that are highly trafficked in current time. By evaluating the area and the delivery zones of the locations rival Panera, Starbucks could utilize their mobile-app’s “messages” as an early notification system for Rewards members that catering is available in their area. With Starbucks already having strong brand recognition and loyalty, it would be easier to market to their current Rewards customers, and provide initial incentives to utilize the catering services such as “Earn an additional 1000 Stars on your first catering purchase.”
Since the company is still financially strong, investing in marketing and internally developing the Catering brand will not have a huge financial impact on the company, but will have a great impact on consumers and communities. By offering Catering services, Starbucks will be able to provide more jobs to people, being in line with their cultures and values as well as their “Opportunity Youth” program, and hiring veterans, and military spouses as well. Starbucks can also grow and overcome some of their weaknesses by continuing to hold themselves to the high standards they state in their mission statement: “To inspire and nurture the human spirit – one person, one cup and one neighborhood at a time,” (Mission Statement, n.d.).
Core Competencies
Starbucks core competencies come from its uncompromising focus on the quality of its products, exceptional customer service both in retail locations as well as corporate, the care for its employees and benefits provided to them, the transparency the company is willing to provide to consumers in the ethical sourcing of materials, continuous product advancement, and the company’s drive to creating a culture of warmth and belonging, where everyone is welcome (Cultures and Values, n.d.). Starbucks is a company that does its best to ensure every customer feels welcome, is served quality products, and has an overall exceptional experience in its stores. From the very beginning Howard Schultz was focused on providing consumers with freshly roasted and poured coffee that was a quality that customers would recognize the product being a higher quality than other brands they have tasted previously. With roughly 87,000 possibly menu combinations Starbucks is continuously innovating its brand by creating new beverages (Booth, 2018), as long as a Starbucks location has ingredients on hand, Baristas can create a wide variety of beverages for customers. This differentiates Starbucks from other retailers, and smaller coffee shops, as Starbucks Barista’s are trained in “Brewing the Perfect Cup” (Booth, 2018) and providing outstanding customer service; if the Barista does not have the exact ingredients on hand they will inform the customer and provide suggestions to ensure the customer is receiving what they want.
Despite the “C.A.F.E.” verifications do not follow the Fair Trade guidelines, Starbucks defines sustainability as an economically viable model that addresses the social and environmental needs of all the participants in the supply chain from farmer to consumer” which “encompass a comprehensive set of more than 200 social, economic and environmental indicators. This approach takes into account everyone from the farmer to the consumer” (Starbucks C.A.F.E. Practices, n.d.). Farms and mills that Starbucks sources from are still also evaluated by third-party verification organizations overseen by SCS Global Services, and Starbucks uses that information further to focus on improvement. Starbucks has also begun to invite other businesses in the coffee industry, including competitors to review and adopt C.A.F.E. Practices to continue to improve best business practices for the coffee industry as a whole (Starbucks C.A.F.E. Practices, n.d.).
Employees of Starbucks (called “partners”), are also very well taken care of, with benefits for both part-time and full-time employees. Howard Shultz has stated that in 2008, the company spent roughly $300M on employee benefits alone (which was more than the company spent on its coffee beans) (Booth, 2018). Employees have stock-options, a 401K, paid time-off, parental leave (including Family Expansion Reimbursement of up to $10,000 per adoption, surrogacy or Intrauterine Insemination for eligible partners), and educational opportunities for eligible employees to earn their Bachelor’s Degrees (Benefits and Perks, n.d.).
Introducing a catering service to the Starbucks Rewards program falls directly in-line with the company’s cultures and values, as well as mission statement. A catering service increases the amount of people the company can reach. When a Starbucks Rewards member utilizes the catering service in a group where there are may be a few people who purchase Starbucks products, there is a greater chance that it will bring in new customers. These potential new customers also will have the opportunity to learn more about the Starbucks Rewards program, and the ease at which it is to sign up for and utilize.Furthermore, Starbucks goals are to be “a neighborhood gathering place, a part of your daily routine,” (Cultures and Values, n.d.). If consumers can easily access their favorite Starbucks breakfast and lunch options for work meetings, family gatherings or other events, Starbucks has achieved being a part of its consumer’s daily routines.
A new catering service will also create several job opportunities in retail locations; Starbucks is a leader in hiring great talent. The company’s values state that Starbucks will always look to create opportunities for partners and customers in the communities we serve (Cultures and Values, n.d.). To date, Starbucks has hired over 25,000 veterans and military spouses and look to hire 5,000 more each year (Cultures and Values, n.d.). Catering will create a variety of positions from management to shift-workers, where Starbucks can also focus on hiring more Opportunity Youth, refugees, veterans and military spouses for various levels. With the creation of new jobs, Starbucks continues to give back to the communities they are located in, as they provide a lot of benefits to their employees. In a day in which there are so many uncertainties, having a job at a company that takes care of its employees is something a lot of people can rally behind.

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