Starbucks Case Study

Key Success Factors for Starbucks Corporation

KEY SUCCESS FACTORS FOR STARBUCKS CORPORATION

1.0 Introduction.

Cole Ehmke (n.d.) described competitive advantage as that which gives an edge to a business over what the competition can offer. It helps to provide the reason why a customer chooses to purchase from a business instead of the competition.

In the light of the above, an attempt will be made to highlight some of the key success factors that have given Starbucks Corporation an edge over others in the coffee sales industry. The writer will like to emphasize that the information on Starbucks Corporation was retrieved from a secondary source and not that the writer has had any physical contact with this organization. Nonetheless, this does not take away anything from the quality of research work that will be put into capturing the key success factors of Starbucks Corporation.

2.0 Stores Expansion

One of the successes of Starbucks Corporation in the coffee sales industry can be associated with the hree year expansion strategy which started in 1992 and was centered on establishing the company presence in all demographically favourable locations which can be serviced by the company's operations structure (Thompson, 1997).

The expansion strategy entails Starbucks selecting a large city in each region that meets its demographic profile and establishing first a hub in the city with a team of professionals. This team is now saddled with the responsibility of setting up 20 or more stores within the first two years of commencement of operations. To further enhance the expansion drive in each region, Starbucks appoints a zonal vice president for each region who supervises and oversees the expansion strategy.

By 1995, the expansion strategy had generated an average of $700,000 in revenue as compared to the average in 1990 of $427,000 before the expansion strategy was launched. Another notable aspect of the expansion strategy was the level of expertise of the real estate team in alwaycompany's