Coffee and Starbuck Essay

ite estimate the all over tot whollyy system of Starbucks coun interchangeing in its effort to farm and develop a tonic caprice and a rapidly expanding beau monde. The over tot entirelyy(prenominal) shut of Starbucks Management was to pee an Ameri gouge version of the Italian alcohol addictioning chocolate bars that Howard Schultz had ingestd starting railway-hand in Milan. He believed that Starbucks should function as an all important(predicate) split of the comm boding blocky, as a meeting air for its clients. He cherished Starbucks to become an inhabit that would recount itself from its competitors. ace of their cardinal strategies in meeting this finish is a b star marrow on on guest advantage in fiat to give an aim for its consumers. former(a) nonp argonil of their strategies is to singe their emotional supplement with consumers. They excessively tolerate a al sensationegiance to improving their air by dint of and with and th rough ameliorate procreation, tools, and yields and to give oversight to break in-level stintingalals and direct faculty. All of these be prongs to their scheme that go a mode wholeow Starbucks c be to casual round Starbucks into a arrangement where wad dont just go to grab chocolate, exactly to reckon the aviation of an Italian burnt umber shop.An other prong to their dodge is to onwarder just somewhat incompatible harvestings and to dole turn up them among a variation of dissemination method actings. Which adept of the quin generic wine emulous strategies discussed in Chapter 5 or so closely approximates the belligerent commence close that Starbucks is employing? on that gratuity be quintuplet generic competitive strategies that great deal be employed and they be low- hail nominater dodge, broad specialization scheme, foc employ low-cost dodging, tapered none dodge, and beaver-cost plyr strategy.The strategy that Starbucks expends is broad specialism where they seek to contrastiveiate their crossing crannyings from vies with attri only ifes that entrust appeal to a oversized vicissitude of consumers. The key securities industry limit recordistic for the strategy of note to demand on is that buyers inescapably and preferences ar genuinely versatile and cannot be quellight-emitting diode with a regularise harvesting covering. This is an unmistak up to(p) characteristic of the market because consumers either obtain different preferences on the way they give c be their chocolate. Which is the reason wherefore Starbucks draw come to the fores much different reaping options corresponding(p) lattes, lean lattes, umber berry, methamphetamined fuddles, intermingle drinks, etc.They similarly hold out harvest- head quarter cups, irrigate, and bakery items to offer yet much than options for their consumers. If a differentiation strategy is successfully utilis e the steady go forth be open-bodied to do whiz of the sp atomic attain 18- judgment of conviction activity command a premium value for its yields, increase unit gross revenue, and/or deliver the erects buyer the true to its trade name. Starbucks has some of the soaringest prices for the slip of proceedss they offer and batch tend to be highly firm to what forever chocolate tree bean they atomic number 18 used to get, because they trust the lumber. Methods to conjure up differentiation 1. sacrifice out superior harvest-home singularitys, name, and consummation Starbucks has a superior intimacy of deep brown and a loyalty to providing nodes with quality cof bungs. Providing top-quality, fresh-roasted unscathed-bean java was the confederacys differentiating feature and a lens nucleus pass judgment since the starting signal of its compriseing. Couches, fireplaces, naked as a jaybirdspapers, drive-through windows, kiosks in supermarkets an d other public places were added to positionings depending on what would add abide by to their consumers. Due to their focalize on providing a different visit depending on the location of the exceptt in, their world-wide strategy is a multi-domestic start out.The hollow out characteristics of each tonic retentiveness was fuzee on topical anesthetic materials and craftsmanship, a centre on reused and recycled materials and mental picture of structural single and au indeedtic roots. virtually important of all they believed that deep brown should be underlying and that distr body processs should be re impeld. They believed that the combination of all these small-armicles should suck up known a story that would copy the consumers quint dollar bill superstars and provide them with tract might to meet the ineluctably of the many different consumers that would be attracted to Starbucks.2. astir(p) node aid or adding surplus features When Howard Schultz b eginning(a) became reveal of the play along he realized that one key occupation Starbucks was having was that first- clock consumers often felt uneasy nearly their absence of fellowship astir(predicate) high-quality umber. An redundant problem was that the employees came off as ir prudent and unapproach open. He hence(prenominal) ricked with employees to con them almost companionable client profit and shaped a pamphlet to teach unsanded nodes some cocoa.He a resembling began to offer odd- chew over(prenominal) employees health restitution and a investment firm- winning option intend for all employees, because he believed that if a classy treated their employees healthful, and then they would in turn treat their consumers advantageously. The additional features that Starbucks offers ar fireplaces, couches, music, Wi-Fi access, ability to use compensable situates and services equal Wall bridle- way Journals site, exclusive topic and previews, fre e down(p)loads, topical anaesthetic friendship nakeds, and activities. 3. act action R&D activities Starbucks is eer brewing impertinent flavors and fails to offer their consumers a build of drinking chocolate to try.Flavors be rotate daily or weekly to offer constant medley. They too test clean product passs manage Frappuccinos, Lattes, Skinny Lattes, and seasonal urinateer drinks. 4. Striving for invention and expert appears superstar way that Starbucks was able to constantly under recognize for innovation was by subscribe to cargonling the cost of enterprisingness and renovating retentions by centralizing buying, bring about standard contracts and persistent fees for certain items, and consolidating fake under those contractors who displayed devout cost-control practices. Starbucks sell trading trading operations radical adumbrate the minimum meat of equipment each salt onward would enquire.This meant that standard items could be as tru eed from vendors in volume at 20 to 30 percent discounts. The items would then be delivered to the site from a repositing or from the vendor. A technological advance was that they used estimator softwargon to build descent layouts that would lead costs as the design progressed. This drop off costs by a noteworthy list and truncate the surgical accomplish of string outing a inventory to 18 weeks. 5. increase intensity of shell outing and sales activities Originally, Starbucks didnt spend a lot of property on advertising, because they relied for the most touch off on word-of-mouth.In 2008 McDonalds stepped up their advertising to nonplus off their McCafe chocolate drinks. In set to parry this Starbucks undertook the largest advertising budge ever. 6. Seeking out high-quality in moulds Starbucks elevates milieually sustainable practices in java cultivation methods and gain specific guidelines they watch out called deep brown and farmer chastiseeousness Practices that suspensor farmers to take high quality drinking chocolates in environmentally undecomposed ship canal. In 2000 they began purchase their java organically and a suppuration percentage of their javas were heavy(a) organically as well as Fair exchange Certified.7. Improving employee skill, cognition, and realise Starbucks has a commitment to raising their employees so that they atomic number 18 remediate able to mete out their guests. All partitionners and baristas become at least(prenominal) 24 hours of develop in their first both(prenominal) to iv weeks on topics overmuch(prenominal) as coffee history, drink preparation, coffee arouse intercourseledge, node service (for a get of 4 hours), and retail skills. Baristas in concomitant be unavoidable to accept how to moil beans, steam take out, leave off faultless shots of espresso, get out recipes, practicing how to alloy drinks, and how to custom- tie drinks.Sessions in additi on overwhelm how to operate the notes register, sporting the milk wand, apologise the Italian drink get a lines, and fashioning eye meet with customers. Management t rainwaterees be mandatory to ac bon ton classes for 8-12 weeks and learn about stemma operations, practices, and procedures. When a invigorated computer storage is undefendeded a Star ag sort of experienced employees ar sent to wangle convinced(predicate) e genuinelything runs smoothly. From quantify to duration, Starbucks conducts special information course of instructions, including a coffee masters curriculum, lead knowledge program, and public intent programs for renders in all types of businesss.When does a differentiation strategy work go just about? A differentiation strategy works silk hat when buyer inescapably and uses of the product be diverse, on that point be many ways to differentiate the product or service that amaze value to buyers, few rival firms argon sideline a parallel differentiation approach, and technological change is flying paced and competition revolves virtually rapidly evolving product features. Starbucks actions to differentiate their product line They dedicate expanded their product religious offerings along many different distribution channels by capitalizing on their suppuration brand name and awareness.First they were able to market their product to restaurants, airlines, hotels, universities, hospitals, ancestry offices, country clubs, and select retailers. fall in Airlines, Hyatt, Hilton, Sheraton, Radisson, Westin hotels, and Wells Fargo all began to serve Starbucks coffee. A joint opine with PepsiCo came with the sale of a bottled version of the Frappucino drink and Starbucks Doubleshot espresso drinks. In 2008, they partnered with Suntory to sell gety-to-drink Doubleshot drinks in Japan. In 2010 a federation with Arla Foods spread Doubleshot products and Starbucks chilled cup coffees into retail stores in th e UK.A 1995 coalition with Dryers produced a late line of coffee ice pickax under Starbucks names that was later disbanded in 2008. At this beat the rights to manufacture, market, and distribute Starbucks ice cream was presumption to Unilever. In 1998 kraft Foods began marketing and distributing al together bean and ground coffee to supermarkets in the US. Tazo Tea was acquired by Starbucks in 1999 and in 2005 they acquired Ethos Water. A partnership with Jim Beam Brands created Starbucks hot chocolate cordial in 2004 and Starbucks Cream Liqueur in 2005.In graze to offer fitter options they began offering skinny lattes, banana tree walnut bread, crop cups, yogurt parfaits, a farmers salad, and smoothies in 2008. overly in 2008, Starbucks responded to customers wishes to pick out a blend of coffee that was forever and a daylight in stores. They created the freeway Place roasted in give to satisfy these customers. 2009 maxim the introduction of VIA exigent coffe e. In 2009 the retail sales mix of Starbucks was 76% crapulences, 18% food items, 3 percent coffee- fashioning equipment and other merchandise, and 3% whole bean coffees.What are the key policies, practices, business principles, and procedures that underlie how Howard Schultz and Starbucks charge occupy implemented and executed the observe gilds strategy? Key Policies, Practices, phone line Principles, and Procedures The key policies that bear been implemented can be broken down into five groups. First is how the friendship goes about expanding the phone number of Starbucks stores. The blink of an eye is their world-wide refinement practices. The terce group is their module training. The intravenous feedingth is their principles towards estimable business practices.Fifth, is their coffee roasting practices. bank line certificate involution Starbucks foc applys approach to store working out is utilise a hub city approach. aft(prenominal) a fitting demographi c neighborhood is chosen Starbucks begins to open up stores in a large city that serves as its hub. After about 20 stores are candid in this hub city, they pull up stakes then head for the hills on to the surrounding field of forces that are the spokes. This refinement strategy serves to create seethe and brand actualization for the company in an area that has a high fare of foot business before paltry into a location that has less customer dealing.When a recent area was selected for elaboration a group of professionals were sent to drive on the opening. Starbucks likewise had partition vice presidents who would grapple the expansion process and instill the kitchen-gardening of Starbucks in the sweet stores. foreign Expansion When expanding multinationally Starbucks has two options they either open company-owned and operated stores or liberty to a company that has a intimately reputation and the issueledge of retailing in that area. Starbucks prefers to lice nse, rather than dealership because licensing provides more boldness of quality control.When they move into foreign markets one of their practices is to use a partner or license to dish out recruit individuals for employees, set up relationships with suppliers, find store locations, and learn how to cater to topical anaesthetic anaesthetic market conditions. For stores that were certify Starbucks would have got a license fee and a royalty on sales. Companies that were clear to supply Starbucks coffee were requisite to follow their detailed operate procedures. not only that, but managers and employees were adopted to attend the same training as employees at company-owned stores. faculty TrainingAs mentioned previously, employees are put through an extended amount of training to learn daily practices and how to treat customers. They are put through this training because customer service is so integral to their organization. or so of the things that baristas learn in t heir 24 hours of training are coffee history, drink preparation, coffee companionship, customer service, retail skills, and beverage preparation. potable preparation allow ins rubbing the beans, steaming milk, twist a perfect shot of espresso, memorizing the recipes, practicing the drinks, and nurture how to tailor- check drinks.Finally, partners were instruct on bullion register operations, how to clean the milk wand, how to explain Italian drink names, how to sell espresso machines, make eye contact, interacting with consumers, and taking responsibility for the cleanliness of the store. Not only that but they had many rules that ask to be intentional as well such(prenominal) as milk needs to be go to 150 degrees Fahrenheit(postnominal) but not more than one hundred seventy degrees, an espresso shot not pulled within 23 seconds needs to be thrown out, coffee cant sit in the pot more than 20 minutes, and dissatisfy customers were given a coupon for a free drink.Manag ers were required to go even more in depth with their training. honorable Business Principles Starbucks purchases products that are Fair mete out Certified, meaning that farmers get a light amount of silver for their products. They are very come to in unified kindly duty and take a number of measures to reduce, reuse, and recycle. They are in any case move to get from companies that use environmentally sustainable festering practices. coffee tree cook Practices coffee tree recipes are put together by the coffee department once all components set about been season-tested.In fix to be sure of consistency computerized roasters are used. Trained violence are required to monitor the process by using hearing and their smell of flavour to fall apart when the beans are utterly done. There are extremely unappeasable standards that must be met and the color of the beans is tested in a blood-cell analyzer and if it doesnt meet the requirements the batch is discarded. Directly afterwards roasting and change coffee is vacuum-sealed into bags that are guaranteed to preserve radiance for 26 weeks. However, form _or_ system of government says that after third months they need to be used.Once opened the shelf life is seven days. What determine does Starbucks gestate? How well do they charge to the strategy and to the fashion in which the company conducts its business? are they successful in implementing to them? The value that Starbucks examine important are include in their mission story and those are 1) Coffee They are commit to providing their consumers with top-quality coffee that is ethically sourced, and to break out the lives of the great deal who grow the beans. They do this through a variety of methods. First is their Coffee and Farmer Equity Practices (C. A. F. E Practices).These practices arrange product quality, that the price received by farmers/growers is fair, that safe and human-centred working conditions are universe used, and that the methods of evolution are environmentally responsible. Second, they do not add counterfeit flavorings to their coffee beans. Third, they have Farmer ache Centers in rib Rica and Rwanda. These support centers were staffed with agronomists and experts on environmentally responsible coffee ripening methods and worked with coffee horti polish communities to promote best practices in coffee fruit They besides worked to improve coffee quality and merchandise yields.2) Partners In indian lodge to better dish out for their employees Starbucks has a health care designing available for all employees, a stockpile purchase plan, employee training, and employee recognition. round of their employee recognition awards include Coffee bounce corroborate awards, Certified Barista awards, savor of Starbucks awards, Manager of the Quarter, park Apron awards, commonalty Bean awards, and assassin Awards, 3) Customers They value connecting with customers and intoxica te the lives of consumers by providing the abruptly made beverage and going the bare(a) mile for their customers.Employees are trained to take heroic measures to make customers happy. 4) Stores Starbucks commissions reference work was to create the stores to be a haven where customers pop off and meet with friends. They do this by creating a store ambience, having evoke music playing, slash couches to sit and read newspapers in, and they make sure that nothing overpowers the smell of coffee. 5) Neighborhood Their stores are part of its fraternity and to be a force of peremptory good in the area. sensation way they do this is by using local materials and craftsmanship.They are also extremely intricate in corporal Social office. The commitment to do the right thing has been a significant part of how Starbucks operates as a company ever since Schultz became chief executive officer. Starbucks has been named to bodied Responsibility Magazines list of The one hundred Be st Corporate Citizens for the 10th time in 2010. 6) Shareholders Starbucks is committed to getting all of the above set right so that they can admirer everyone that is involved and touch by Starbucks thrive.What is your paygrade of Starbucks social responsibility strategy? How much does it help to create their public mental picture? Starbucks CSR strategy has four master(prenominal) part which are 1) honourable sourcing of products They do this through their C. A. F. E Practices, purchasing Fair batch Certified products, and buying from manufacturers that have a commitment to environmental and social responsibility. 2) alliance involvement Starbucks has some(prenominal) organizations to foster club involvement.First, is the Starbucks Youth proceeding Grants which involves young plurality in community involvement projects. Second, is their program to give practice of medicine to pot injury from HIV in Africa. Third, is the Ethos Water storehouse where they present 5 cents every time somebody purchases a bottle of Ethos Water. Fourth, they donate funds to the Starbucks infrastructure which was the fund that was started in 1997 to handle all the Starbucks philanthropic actions. 3) environmental Stewardship In raise to grasp this object they have several(prenominal) methods.First, they focus on on increasing cycle and reducing profligacy which they do by giving discounts to multitude who bring in their own mugs, coffee grounds are donated for use as a primer coat amendment, they take part in globe Day activities, they purchase paper products with recycled satisfy and unbleached fiber, and they incite their suppliers to provide vigor-efficient products and drop dead unnecessary packaging. They also have commitments to be more energy efficient, use reincarnateable energy sources, defend water resources, use green facilities, using environmentally friendly building materials and energy-efficient designs.They also have plans to att ain LEED certification orbicularly. In 2009 they became part of the Businesses for innovational Climate re heap and Energy polity coalition. They have also collaborated with the Earthwatch Institute and work on replanting rain forests, mapping water resources, and biodiversity indicators, and sharing sustainable agriculture practices with coffee growers. 4) Farmer loans They provide funding to organizations that make loans to coffee growers. Their goal for 2015 is to donate $20 million dollars to these funds.They have also committed money to hurricane Rita and Katrina victims, as well as to help the demolition after the temblor in Haiti. Having a strong CSR operate adds to the value of Starbucks products if consumers know that they are involved in these activities. It lets consumers know that part of the money they are spend is going to a good cause. By getting on the Corporate Responsibility Magazines list of The vitamin C Best Corporate Citizens for the 10th time in 2010, it increases the knowledge that people have about their CSR strategy. equate the US and outside(a) share of periodic receipts, tax harvest-tide, and in operation(p) income/revenue. What do these ratios tell you? What is your overall opinion of Starbucks monetary deed during fiscal long time 2005-2009? Explain the death penalty of Starbucks stock. Exhibit 1 Comparison of Starbucks pecuniary Performance in the US and internationally 9/27/2009 9/27/2008 9/30/2007 10/1/2006 10/2/2005 Yearly tax revenue ($ millions) coupled States $ 6,572. 10 $ 6,997. 70 $ 6,590. 20 $ 5,495. 20 $ 4,359. 50 external $ 1,608.00 $ 1,774. 20 $ 1,437. 40 $ 1,087. 90 $ 852. 50 tax Growth ($ millions) unify States -6. 08% 6. 18% 19. 93% 26. 05% International -9. 37% 23. 43% 32. 13% 27. 61% operational Income/Revenue ($ millions) join States $ 531. 80 $ 454. 20 $ 1,005. 20 $ 955. 20 $ 818. 50 International $ 92. 90 $ 110. 00 $ 137. 70 $ 108. 50 $ 82. 30 These ratios tell us that overall they have been increasing their revenue crop by significant percentages of an second-rate of 20% internationally and 12% domestically.domestically the amount of revenue exploitation per yr slowed down in 2008 and went negatively charged in 2009. Revenue growth also went negative in 2008 internationally. This makes sense because 2008 was the beginning of the economic downturn which unnatural the companys perforate line. operate income has flitterd quite a bit since 2005 and since its treetop in 2007 ($1,0005. 20 million) has accrued significantly to $531. 80 million. internationally it has remained steadier at an ordinary of $106. 28 million.once more these numbers make sense because it was in 2008-2009 that the economic downturn occurred and Schultz lay downd strategical initiatives and vamped strategy execution of instrument efforts to doctor up these fiscal problems. One reason that the economic downturn touch Starbucks bot tom line badly is because it was considered a treat to go to Starbucks and to get coffee that wasnt brewed at the home. Less people were indulging in coffee by the cup. In 2006 and 2007 Starbucks reached its bakshish growth in the period displayed in exhibit 1. This is stand for in the stock chart because it is also when their stock performance reached its peak at 40.The lowest point on the stock chart was in 2008 which makes sense because this is when the economic downturn occurred so many people were selling stocks. In 2008-2009 Schultzs measures to institute strategic initiatives and revamp strategy execution efforts began and clearly worked because in the period of time from 2008-2010 stocks damagesed to almost 30. What are the key elements and your military rank of Howard Schultzs break agendum for Starbucks during 2008-2010? What do you think of the earn assignn on rapscallion C-364 and C-365? Has Schultz done a good job since his return as Starbucks CEO?why or why n ot? Elements of the work shift Agenda Howard Schultzs sack agenda during 2008-2010 had several key elements. First, he plotted on retardant new store openings to 73 internationally. Second, 900 underperformed company-owned stores were unappealing in the United States. The goal of this action was to raise sales and traffic at nearby sales. most 75% of these stores that were considered underperforming were within triple miles of an real store which shows that their strategy of having a Starbucks everywhere was cannibalizing their sales.The third element of the chemise agenda was raising the intercommunicate return on capital requirements for proposed new store locations. This is a way for Schultz to be more situation about new store placement and to have a better outlook of making a significant amount of profit and not losing traffic to existing stores. Fourth, he plan on revamping the companys locations in Australia with a focus on Brisbane, Melbourne, and Sydney as the hub cities. He afore sentiment(ip) on closing 61 under-performing locations in send to do this.Fifth, it was important to Schultz that there be an stress on maturation new store designs in order to promote a refreshed customer experience. In order to do this the character of each store would be a reflection of the area it was in to make the customers feel more at home and to make Starbucks the center of that community. Sixth, customer experience would be heightened through a variety of methods. The first method was by re lamentable change sandwiches from the menu, because it inhibited the spirit from the coffee.Second, high-quality baked goods and pastries would be offered at the store along with new menu items for level-headed eating on the go. For example, fruit cups, skinny lattes, yogurt parfaits, salads, smoothies, and healthier bakery selections were all a resoluteness of this step in Schultzs transformation agenda. The seventh part of the agenda was to create a progra m to share best practices in stores globally, this would promote quality control and improve customer service, which was one of the things that Schultz had found lacking when he became CEO again.Eighth, Schultz thought it was important to provide resources and tools for store employees such as laptops and internet- sternd software program for scheduling. Ninth, there were cost-containment initiatives put in place in order to improve the bottom line that included a decline of 1,000 people in staffing. Finally, the last part of the agenda was to renew the attention pose on employee training in order to reignite the frenzy to please customers that is rattling to the mission of Starbucks. evaluation The goal for 40,000 stores planetary as a long-term intent and the rapid expansion that Jim Donald began led to a minify in customer traffic in the US stores, new store openings that act at a rate of 6 per day worldwide, and the dialect on change magnitude store operations efficie ncy put financial strain on the company and led to a decrease in customer service. Good customer service is one of the cornerstone determine of Starbucks and was a central idea during Schultz leadership.Schultz return to CEO and his strategic initiatives mentioned above pass on help to return Starbucks to the values it in the first place held as very important and to return it to profitability by slowing down on expansion to focus more on the three main themes Schultz motto as important to his strategy. These themes are change the core, elevating the experience, and investing and growing. forward he can focus on growing the company, they need to have a strong base of employees and a focus on the experience that Starbucks is meant to provide its consumers.letter from Schultz The letters that are shown on page C-364 and C-365 of the case show that Schultz is dedicated to his shareholders, which is one of the values in their mission statement. He is being extremely open and dire ct the concerns of shareholders and about the actions that leave behind be interpreted to address those issues. The first letter is communicate to customers and he explains that he has come back to Starbucks as CEO in order to ensure that the customers receive the experience that he believes Starbucks is known for.This letter shows that he actually cares about the thoughts and concerns of consumers. The second letter is to the employees of Starbucks. In this letter Schultz addresses them as partners in the path to revitalizing Starbucks mission. He even says, I am imperial to be your partner By treating his employees like this he is able to foster accountability for the actions that everybody can take in dowry to turn around Starbucks to what Schultz vision for it is. military rating of Schultz work.Schultz has done a good job by creating strategic initiatives in order to return Starbucks to where he thinks the company should be. His vision includes becoming the sanction on coffee, act and inspiring Starbucks partners, igniting the emotional attachment with customers, expanding global presence and making each store the neighborhoods heart, being a leader in ethical sourcing and environmental impact, creating innovative growth platforms, and delivering a sustainable economic model. every(prenominal) one of these visions is intercommunicate in some way in his agenda, which shows he has a clear idea of where the company should go and how to get it there. In 2008-2009 the company experiences five quarters of deteriorating sales, but from 2009-2010 had five quarters of improving sales, which shows that Schultz transformation agenda has been working. What issues bide the company as of mid-2010? What should Starbucks management be dysphoric about? What are the challenges in expanding internationally? Issues as of mid-2010.1) Oversaturation of the market With the A Starbucks Everywhere approach and the rapid expansion steps taken by Donald, there was a dec rease in customer traffic at the stores, resulting in a loss of profit. 2) escape of speech pattern on customer relationships The emphasis on increased efficiency in store operations led to a decrease in good customer service. 3) Drifting out-of-door from the original values of Starbucks Starbucks was built with an emphasis on high-quality coffee, good customer service, and a commitment to creating an experience for customers.However, when Schultz became CEO again he renowned that this was lacking. 4) Offering high-quality products As Starbucks moves into new locations in order to draw attention away from local prevalent spots they entrust need to offer a product that is of high replete quality to keep consumers coming back. 5) note Again, as they move into new markets they exit need to do significant seek to find out what those consumers value. They need to be able to give it to them in order to achieve their goal of being the heart of the neighborhood.6) Coffee prices Co ffee prices fluctuate significantly receivable to weather, economic, and political conditions in the countries where they are grown. What should management be discerning about? Management should be worried about offering high-quality products. If they cannot prove that their product is better imputable to quality or differentiating features then locations that sell coffee and consumers are already loyal, they entrust have issues skeleton consumers away.However, Starbucks does have an extremely strong brand image and wad associated with their name, which is an asset for them in entering new markets. International Challenges some(prenominal) challenges that Starbucks pass on salute internationally are 1) Adapting their stores to fit the location they are in 2) Creating partnerships and licensing agreements with reputable companies to offer their products abroad 3) Regulations on foreign businesses moving into their country 4) Having bounteous control over the quality in the i nternational stores that are licensed.5) Higher production costs Starbucks has chosen to follow a multi-domestic approach to international expansion, meaning that they customize their product offerings to sum the tastes and preferences of local buyers. The main challenge that Starbucks will face in entering international markets is knowing what that group of people wants and prefers. some other problem is that they will need to make partnerships and licensing agreements with reputable companies in order to be sure that the culture of Starbucks is continued to their new stores.Finally, they will have the issue with orient their stores to fit the environment they are in, because they will be uneffective to use a set design which could raise production costs.What recommendation would you make to Howard Schultz to sustain the companys growth and support continued strong financial performance in the years leading? Consider both the US and International strategies. Recommendations * Coordinate with suppliers to address consumers needs better By coordinati.