Businesses Starbucks example essay topic

Shultz makes it very clear as to what the company goals are. Their objective is to offer more than just a great cup of coffee; they want to offer a memorable experience. The company continues to work towards its long-term goal of becoming the most recognized and respected brand of coffee in the world. It works to achieve these goals through its many lines of businesses. These businesses include retail outlets, grocery channels, mail orders, merchandising, bottled iced coffee beverages, and ice cream (Carrol). In each of these businesses Starbucks maintains similar relationships.

Quality is a main factor in all, as the company produces a premium product for the consumer. Specialty sales have also become an important corporate-level strategy for competence. Starbucks has created agreements with retailers, wholesalers, restaurants, and service providers to carry its specialty brand of coffee. This allows Starbucks to increase its name recognition while at the same time creating revenue for growth. In every partnership entered into they only chose leaders in their field, and companies that had excellent reputations for success and quality, much like the message Starbucks is trying to send to its own consumers. The partners they have aligned themselves with include United Airlines, Barnes & Noble, Pepsi Co, and ARAMARK just to name a few (Schultz).

It is clear by looking at these partnerships, and the preceding lines of businesses that Starbucks is involved in, that the company is pursuing a related diversification corporate strategy, as everything hinges on the production and sales of its core business, specialty coffee. By looking at SWOT analysis of the coffee industry, this type of business strategy is very effective. By creating a type of work atmosphere with employees wanting the company to succeed, and rewarding the for it, Starbucks has achieved more in the last ten years than most businesses could ever dream of (Starbucks Coffee Company Executive Report). They are an ever-growing company, but somehow manage to limit their growth as to not spread themselves to thin, and run the risk of over-branding their product.

The new ventures they are taking on are both of related substance, and should be pursued aggressively. The Starbucks formula is decisively based in its coffee, its employees, its merchandising, its ownership values, its real-estate approach, its image, and its innovative ness. Starbucks puts a great deal of effort into its quality control system. They cover every detail from product freshness, to timely delivery, to protection of its roasting formula.

They begin with maintaining close relationships with its exporters by working with them directly, and providing them with extensive training to ensure they realize how their company wants things to be done (Ortiz). By creating such a close relationship they build loyalty with the exporters, which can lessen conflict in future transactions. This type of training is not limited to just exporters, but to direct employees of the company as well. Starbucks wants its employees to provide the best service possible, and to be able to provide the customer with any information about coffee it may require. Also, to keep high morale and create motivation, employees were paid a higher wage than most food service companies. They were also provided with health insurance, disability, and life insurance.

As well, all company employees received a stock option plan. This type of reward motivates employees, and creates little turnover though having them wanting the company to succeed in order for them to become profitable (Ortiz). They also carried this type of philosophy over to its real estate agents. These agents are guaranteed a minimum commission for every store bought, and this created a loyalty amongst Starbucks and the real estate network. With a rapidly expanding company this is vital to growth, and motivation of the real estate staff should be made a top priority. Assurance of overall quality does not stop there.

Maintaining a fresh product throughout the stages of the business, from exporters to the final consumer, has been precedence. In every shipment of 250 bags to the company, Starbucks will extract three different samples during the shipment procedure. If at any time it did not meet quality standards, the company reserved the right to reject it and send it back. As well, packaging was innovative ly developed to ensure freshness.

One-way valve technology extended the shelf life of its coffee to 26 weeks (Clarke). This can turn into large cost savings, as the discarding of coffee decreases. Starbucks also protected against the possibility that someone could replicate their roasting procedures. Roasting was key to the company, because its taste depends entirely on this process. Computerized roasters were put in place to guarantee consistency, however roasting techniques were built into proprietary software to ensure that if a roaster were to work for another company, they would be unable to give away this vital information (Schultz)..