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Starbucks: Sources of Competitive Advantage

Starbucks: Sources of Competitive Advantage. Key Questions. Do you like Starbucks? Why do people buy Starbucks? What are people buying when they buy Starbucks? Is the company successful? What are key measures of success? What are Starbucks core resources? …capabilities?

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Starbucks: Sources of Competitive Advantage

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  1. Starbucks: Sources of Competitive Advantage

  2. Key Questions • Do you like Starbucks? • Why do people buy Starbucks? • What are people buying when they buy Starbucks? • Is the company successful? • What are key measures of success? • What are Starbucks core resources? …capabilities? • What should Starbucks do?

  3. Products • Coffee • Made-for-you • Make-it-yourself • Bottled/canned • Coffee-related Products • Ice Cream • Beer (Red Hook Stout)

  4. What is Starbucks? • Coffee • High quality • Interesting blends/brews • Consistent • Coffee Drinking Experience • Upscale, hip • Consistent • Place to be

  5. SBUX Stock Price $30 $10 1997 1998 1999 2000 2001

  6. Keys to Success • What are Starbuck’s strengths? • Are they: • …valuable? • …rare? • …inimitable?

  7. Value Chain of Firm Activities Firm Infrastructure Human Resource Management MARGIN Technological Development Procurement Service Inbound Logistics Marketing & Sales Outbound Logistics Operations

  8. Resources and Capabilities • Image, reputation • Real estate • Knows customer • Participation in full industry value chain • Inbound logistics, Sourcing • Roasting, operations • Outbound logistics, distribution • Marketing • Service

  9. External Analysis Opportunities: Threats:

  10. Strategic Recommendations • Do XX • Value chain activity ‘a’ • Value chain activity ‘b’ • Result: • Do YY • Value chain activity ‘a’ • Value chain activity ‘c’ • Result:

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