6) Starbucks is one of the best known coffeehouse chains in the world. Each stor

Question

6) Starbucks is one of the best known coffeehouse chains in the world. Each store sells a variety of innovative products to complement the array of coffee choices available. However, 75% of current stores are located in the United States and the expensive nature of the coffee leaves Starbucks vulnerable to changes in consumer spending behavior (such as recessions). Recently Starbucks has begun initiatives to sell its specialty coffee beans for home use, presenting a chance for a large increase in revenue and diversification. However, Starbucks faces fierce competition seeking a piece of its lucrative market share and the threat of consumer behavior changes, given its reputation rides on a singular product. Perform a SWOT analysis for Starbucks.

Explanation / Answer

Strengths Largest market share in industry Differentiated atmosphere Weaknesses Aggressive expansion could lead to managerial / financial problems Opportunities Whole bean sales in supermarkets Threats Lack of ownership of coffee farms can lead to price fluctuations

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