Question

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Please help me solve following case study. Thank you so much

WHAT STARBUCKS STRATEGIES ARE BEST?

There is only so much revenue that coffee, lattes, and pastries can bring in, so Starbucks performed SWOT and QSPM analyses and decided to spend millions on three new strategies: (1) provide beer and wine, (2) provide expanded lunch and dinner menus, and (3) provide advanced mobile ordering. Several key factors that entered into this decision were (1) there have been long wait times for customers to get served at many of its locations, (2) company business had fallen off 30 percent after morning breakfast, and (3) rivals Panera Bread, Atlanta Bread, and Dunkin Donuts were expanding their menus and growing revenue 15 percent faster than Starbucks. Starbucks’ five-year strategic plan is to double its U.S. food revenue to more than $4 billion, with wine and beer alone adding $1 billion in 2015. Starbucks’ new food items include truffle macaroni and cheese, Parmesan crusted chicken skewers, bacon-wrapped dates with balsamic glaze, artichoke and goat cheese flatbread, and chocolate espresso, champagne, and raspberry truffles. Starbucks’ new wines include a variety of sparkling, red, white, and rose choices. Starbucks’ new mobile app and coffee truck and delivery trucks help stores anticipate demand, so customer orders are often available immediately.

Questions:

1. Develop a SWOT Matrix for Starbucks that includes the three strategies and three factors cited in the case.

2. Develop a 3 × 3 QSPM for Starbucks that includes the three strategies and three factors cited in the case. Which of your three factors received the highest weight? Which of your three strategies was most attractive? Explain. Source: Company documents and a variety of sources.

Answer 1

Answer:
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SWOT of Starbucks

1:-Strengths:

Strong financial performance in the coffee market

Renowned brand image among the customers

Extensive global supply chain maintaining the quality of the product

Use of subsidiaries for diversifying business

2:-Weaknesses

Limited to coffee industry

Price range of products not affordable for medium and lower income groups

The products offered by Starbucks can be easily copied

Long wait time at many outlets lead to dissatisfaction among customers

3:-Opportunities

Expansion of service by including other beverages like beer and wine

Expansion in lunch and dinner service
Launch of mobile ordering app which will help in increasing its customer coverage

4:-Threats

Competitors expanding their menu and revenues

Easily imitable products

Very low market entry barriers

2): :-
Long wait time for customers received the highest weight. The strategy of launching mobile app for instant ordering was the most attractive as this gives the ease to the customers for doing business with Starbucks. Most of the consumers of Starbucks are office goers and college kids who have limited time. They want to grab their breakfast and be on the move. Launch of mobile ordering app will match their pace and thus satiate their demands and expectations.

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