Starbucks Supply Chain Operations example essay topic

The organizational structure of Starbucks is very flat in encourages competitive ideas from all levels of the company. Starbucks places a great deal of effort into seeking the thoughts and opinions of its employees, and they value what they have to say, because they are the ones in direct contact with the companys customers. The head office managers keep in touch with the field people, and have meetings to collect questions and gave answers about any topics, in a type of open forum atmosphere. Starbucks Supply Chain Operations has a very effective structure. It has great transportation rates, a complex bakery distribution model, an accurate forecasting process, and a fully integrated manufacturing and distribution process (Schultz). The company developed these skills because it used benchmarking as a competitive strategy.

It also hired experts, and believed strongly in the concept of integrated supply. They focus on the building of its supply chain operations to eliminate redundancy and maximize efficiency. Starbucks has created such a strong corporate culture and strong work values, that it allows a company like this the ability to successfully engage in product diversification. However, amongst the first things Starbucks needs to do it to concretely define its brand image. This image however, needs to be conveyed to the market in a precise manner, so there is no confusion amid Starbucks customers. This is vital if Starbucks wants to maintain its domestic market share and face the competition challenge decently.

Once this has been created, they can move on to other projects with a smooth transition. The whole bean industry is an area with which Starbucks should look in to. This is an avenue with rather large estimated growth revenues. Over the last decade the whole bean industry has been growing, and Starbucks has yet to take advantage of this untapped market (Talbot).

Adding this line of coffee should not be a difficult one, as Starbucks has top of the line suppliers, and maintains good relationships with them. As well, an important area of expansion for Starbucks is specialty sales. This allows the company to get its name out into the public without having to incur costs of store purchases, employee salaries, and large equipment costs. Typically a Starbucks store can cost the company up to $340,000 to start up. Considering the company wants to generate 20 to 40 stores per month, these costs add up quite significantly (Talbot). When entering into agreements with these partners, Starbucks must ensure that they will be quality associates.

It does not want to run the risk of focusing too much on expansion, and too little on who they are expanding with. Perhaps a little less aggressively Starbucks should enter into the ice cream and bottled beverages market. The partnership with Dryers is a joint venture, and is an affiliation that allows Starbucks to get its name into the grocery channel, and hit an entirely new customer base. Domestically, the Frappuccino venture should not be followed with a great deal of intensity.

Bottled iced coffee beverages have had a tough time in the past cracking into the North American market. However, the product does look promising overseas, specifically the Pacific Rim where there is already a market for cold coffee beverages. Estimated sales look strong, and this is a product that if paired with the right promotion, could become a great investment for Starbucks. Overall, as long as Starbucks maintains and promotes a strong quality product, without deterring from its corporate-level strategy, it will always have a great number of opportunities ahead. There is a very strong base for this company, which will allow it to pursue desired avenues with aggressiveness and confidence.

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