1. STARBUCKS[F]

8/3/2019 1. STARBUCKS[F]

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International Business course

2012

Maria JOGI

Marina KONIAKINE


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y I. History of Starbucks

y

II. The choice of Foreign Direct Investmen

y III. Conclusion success of Starbucks


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y Founded in 1971. By Jerry Baldwin, Zev Siegel andGordon Bowker. In 1987 Starbucks were sold toHoward Schultz.

y Pikes Place Market in Seattle, United States ofAmerica.

y Starbucks s name and logo named after the firstmate in Herman Melvilles Moby Dick. Logo is alsoinspired by the sea featuring a twin-tailed siren fromGreek mythology.


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y By 1980

y Today more than16,000 coffee shops inmore than 50 countries.


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y Company is the premierroaster and retailer ofspecialty coffee in theworld

y

Starbuckss Corporationwas formed in 1985y Stock trades on NASDAQ

Global Select Market(SBUX)

y In addition to the flagshipStarbucks brand there are:Tazo Tea, Seattles BestCoffee and Starbucks VIAReady Brew.

Starbucks in numbers:5-Year Averages

y Return on Equity 22,50%y Return on Assets 11,80%y Return on Assets 11,80%y Return on Invested Capital

19,20%y Gross Profit Margin

43,90%y Total Debt/Equity Ratio

0,26


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y FDI occurs when a firminvests directly in facilities toproduce or market a productin a foreing country

y For the US Dpt of commerce:

From 10% and more

y Greenfield investment orAcquisition


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Joint venture Acquisition:

y Quickly reach a foreign market

y Have the valuable assests of the firm they acquire

y More control on the operations (products, training)

Strategy since 2007:

y Aggressive foreign program

y Some specific countries needed Wholly owned subsidiaries


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Advantages:

y Emprovment of the existing facilities and system

y More control on processes (quality)

y

FDI may import intermediate goods or inputs forproduction from the home country, creating jobs

y New skills from exposure to foreign countries qualitycontrol

Drawbacks:y Increasing costs for quality control

y Risks involving excisting facilities and inventory


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y Starbucks brand

y Key perception and reaction

y Starbucks changed the strategyy FDI JV investments

y Starbuckss case as an example and a model of success


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y Starbucks' new mobile payment application onBlackBerry

y the company has plans to go even higher tech

y Supermarkets have become a big part of Starbucks'business. The company turned its instant coffee line,Via, into $250 million worth of sales in 14 months.


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y Starbucks official website: http://www.starbucks.com/

y Book: International B. Charles W. L. Hill

y Starbucks company profile

http://www.starbucks.com/assets/company-profile-feb10.pdf

y Wikipedia: http://en.wikipedia.org/wiki/Starbucks

y Article: Starbucks CEO Howard Schultz looks to the futurehttp://articles.sfgate.com/2011-04-07/business/30226648_1_instant-coffee-starbucks-ceo-howard-schultz-coffee-brand

y Starbucks Finance: http://finance.yahoo.com/q?s=SBUX

1. STARBUCKS[F]

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