Tugas Pak Zein

7/23/2019 Tugas Pak Zein

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Good morning my dear colleague, its a pleasure to be here . Thank you very much for coming

today, and its great to have Mr.Zein Arifin here with us as you all know he guiding us for

preparing our presentation.

My talk today entittled Starbucks s strategic analysis Past decision and future options


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ell, ladies and gentleman the ob!ective of my presentation today is describing the "tarbucks

past decisions and their new strategies


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#m going to divide this talk into $ chapters. The first chapter namely "tarbucks snapshot, in this

part # will describe about who is "tarbucks, overview about their history and some data about

their e%pansion. Moving on to ne%t chapter # would like to e%plain what is "tarbucks original

generic strategy , # will elaborate this later. &e%t we have Michael porters five forces analysis

past ' present comparison, this model is to develop an optimum strategy for success based on

specific parameters.

Turning to chapter ( # will describe some factors behind "tarbucks success


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)aving thoroughly analy*ed the past, present and future of the specialty coffee industry and the

general strategies necessary to attain success, in chapter + # would like to e%plain some

recommendation for "tarbuckss future action. The last chapter of my presentation is summary

' conclusion.

ell, if everyone is ready lets start


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This is the picture of first store in "eattle,ashington. ight now, "tarbucks become world

leading coffee company


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"tarbucks was established in -/- in "eattle by 0 scholars. At first they speciali*ed in whole

beans coffees, later move to espresso drinks and other baverages

This is the 0 founder of "tarbucks


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This is )oward "chult*, the 123 of "tarbucks. #n -45, he was hired as a director of retail

operation. hile on a business trip in #taly he visits famous espresso bar, he sees potential in

"eattle. "chult* wanted to bring the #talian caf6 culture to the 7nited "tates. "elling espresso by

the cup was the first test, he began working with the founder 8erry 9aldwin


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"chult* left 9aldwin to open his own and raised money from investors to purchase the #talian

1offee )ouse Giornale.

#l Giornale ac:uires "trabucks assets in -4/ with the backing of local investor and changes its

name to "tarbucks corporation.3pens in 1hicago and ;ancouver 1anada. At that time, total store

-/.


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&ow, turning to "tarbucks mission, this is the mission of "tarbucks now and then. To accomplish

current mission, "tarbucks has seven principles which is 3ur 1offee, 3ur


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=et us proceed to "tarbucks menu. 9asically, there are 0 products > drink, food and merchandise.

ight now there are more than 0? blends ' premium coffee, as we can see from that picture they

sell various fresh food like sandwiches, salad, pasteries ' baked, beside that they also offer

Merchandise for e%ample coffee tea brewing e:uipment, mugs, coffee makers etc.


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=ets now take a close look at this bar graph. This is the bar graph of "tarbucks retail e%pansion

from -4/ to 5?-? . This bar graph show us the trend between -4/@-0 are stable this is due to

"tarbucks e%pands beyond "eattle, first to the rest of the 7nited "tates, then the entire world.

=adies and gentleman,as you can see This bar graph show us a significant rise in the "tarbucksretail e%pansion ,its more than doubling every two years , with (5+ stores in -( to -??$ stores

in -$, and its keep growing until now. This is due to their integrated strategy e to e%pand their

brand around the world. 2ssentially, it was "tarbucks mission to have a green twin tailed siren on

every street corner. ight now "tarbucks have 5?.-+ stores across the world as we can see in

this picture below


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The ne%t area #d like to focus on strabucks original strategy. As defined by Michael overall cost leadership, differentiation and

focus

3verall cost leadership can be done through tightly controlling overhead, avoiding marginal,

less profitable consumers and sacrificing research and development, customer service,

advertising and other areas not pertinent to the direct manufacturing of a product.

ifferentiation ,This can take on many different forms including but not limited to brand image,

technology, features, dealer ,networks and customer service.

The last generic strategy mentioned is focus, which targets a particular group, geographic

market, or segment of a given product line


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=ooking at the characteristics of a company pursuing the generic strategy of focus, as illustrated

by Michael


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Moving on now to success factors of starbucks. This is the three factors behind their success #

will elaborate one by one


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#n todayBs interconnected world it is important to develop a feeling of community. ay

3ldenburg, a Clorida sociology professor, attributes much of "tarbucks success to its ability to

offer this third place or as he puts it, the great good place in modern society. Two of the most

prevalent themes during the -?s and early millennium were that of increasing numbers of

people working from their homes and the increasing use of the #nternet and mobile computing

devices capable of accessing it. Today, "tarbucks has gone to great lengths to take advantage of

these environment change. Cor e%ample, they have recently struck a deal with AT'T, which will

allow them to offer free wireless internet access to some customers at the ma!ority of its 7"

stores.


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The second factor is employee satisfaction. Crom the perspective of the "tarbucks corporate

team, the :uality of the baristas and other employees was the most important ingredient of

"tarbucks success, ne%t to the specialty coffee itself. 9y involving all employees in the e:uity

success of the company, "tarbucks effectively created a clear incentive for employees to both

reduce costs and treat customers with e%ceptional service.


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The last facor of starbucks succsess is maintaining :uality of Arabica beans. There are many

different reasons why an organi*ation such as "tarbucks would undertake a strategic alliance

with an organi*ation such as 1onservation #nternational. "ome of the primary reasons include

the attempt to reduce risk, the attainment of economies of scale, preemption of competition, an

attempt to overcome government barriers.

9y collaborating publicly with 1onservation #nternational, "tarbucks stands to increase their

legitimacy with other &G3s, thus reducing the risk of protests and the negative implications

those protests would have on their brand image. This alliance also allowed "tarbucks to attain

economies of scale in regards to their ability to contribute positively to the community and the

environment


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&ow we turning to Michael porters five forces analysis. #n this part # compare between past and

present in order to make us undrestand the different between past and present starbuckss

environment. The first comparison is industry rivalry The environment in which the specialty

coffee industry had to compete during the late -4?s was made up of both product based

competition and retail@based competition, they now compete against companies of varying si*es

and different e%posures to specialty coffee.

Turning to second factor the potentials for new entrance 1umulatively, the barriers to entry seem

high in the specialty coffee industry in the late -4?s due to high product differentiation, high

speciali*ed capital re:uirements . &owdays it can be ascertained that the barriers to entry in the

specialty coffee industry have increased substantially. As a conse:uence, the potential threat of

new entrants has gone down.

=et us proceed to the third factor


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#n the past, the only true direct substitute for specialty coffee available was basic coffe. )owever,

basic coffee was considered to be of significantly lower :uality than specialty coffee. As a

result, it actually presented the industry with little threat of substitution. Today, Many companies

that presented the specialty coffee industry with a threat in the form of substitute products have

actually entered the industry and now compete directly by offering their own premium coffee

selections. The primary substitute products still posing a threat to the specialty coffee industry

are the caffeinated soft drinks offered by


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or supplier costs which greatly reduces their bargaining power. The amount of bargaining power

that can be e%erted by the buyers within the specialty coffee industry today,has increased as a

result of the availability of information regarding market variables. This along with the other

previously discussed changes to the dynamics of buyer bargaining power has increased its

overall magnitude from the level it was at in the late -4?s.

The last factor is the suppliers bargaining power. hen comparing the bargaining power of

suppliers today in the specialty coffee industry to the bargaining power of suppliers during the

late -4?s, it is apparent that suppliers are more powerful today. The increased unity among the

coffee farmers, decreased significance of specialty coffee retailerBs purchases as a proportion of

premium coffee bean sales and increased importance placed on high :uality coffee beans by the

purchasers have all acted to increase the bargaining power of the supplier group.


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=ets turn now to recommendation for future action. )aving thoroughly analy*ed the past,present and future of the specialty coffee industry and the general strategies necessary to attain

success, a list of recommendations specific to "tarbucks can be ventured. Cirst, increase

international e%pansion . The international market provides an ideal target for e%pansion because

the lack of penetration of specialty coffee in many nations and the potential market share which

these nations represent.

The second ,rewards program "tarbucks should concentrate on creating more elaborate

discounting techni:ues to employ with their most fre:uent customers. This both eliminates thepotential degradation of the "tarbucks brand and increases the bond customers will e%perience

with "tarbucks.

&e%t, "tarbucks should create a more business and technology friendly atmosphere in its stores.

The meeting space should be offered at a per hour rate while the printers should charge per copy.


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=astly, increase connection with customers, "pecifically, "tarbucks encourages feedback from

their customers to induce a family like feeling and instructs all baristas to greet every customer

with the :uestion Dhow are you doing todayEF. To further increase this emotional connection

with their customers, "tarbucks could implement digital picture frames in all store locations and

upload local customer photos and perhaps even customer supplied family photos, which are

appropriate in nature, upon re:uest.


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Cinally, let me remind you of some of the issues weBve covered. The first

starbucks store opened in seattles pike place market in -/- and the company grow


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to be largest roaster in ashington with multiple location in early -4?.The "tarbucks

3riginal Generic "trategy is differentiation and focus. "ince the 5?? recession, the

company has sharpened its focus on increasing international store count to mitigate

the risks attributable to local unfavorable economic conditions. #t has also been

attempting to improve international brand awareness.

Their success was fostered as a result of some action taken by starbucks.the

starbucks aggressive e%pansion plan was more ambitous than any other speciality

cofee retailer. At starbucks, employee satisfaction also played a pivotal role in their

success Cactor which added to their success was their ability to consistently produce

the highest :uality speciality coffee 3vertime the speciality coffe industy has become

much more competitive.


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Cinally, we can conclude that "tarbucks corporation has arguably been the most

successful coffee chain in the pas t few decades, using their aggressive e%pansion

strategies to push out much of its competition.Through its e%pansion, starbucks has

focused on creating a dense network of stores all around America, while also opening up

new location around the world .


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# think thats all my presentation entitled "tarbuckss strategic analysis@ past decision and future

option. Thank you for your time and your attention. As always, let me know if you have any

:uestions about presentations or this particular topic by email me.

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