Starbucks
Corporation

Table of Contents

Introduction

Organizational Goals

Symptoms of the Problem

Diagnosis of the Problem

SWOT Analysis

Recommendations I. Introduction:

In 1971, in Seattle, Washington, three entrepreneurs started the Starbucks Corporation. The primary business at this time was the selling of premium whole bean coffee in a single Seattle store. At the time, coffee consumption in the U.S. was on the decline and market dominance was established by the large supermarket brands. However, companies such as Starbucks, who began selling high quality specialty coffee, began to establish a following of loyal coffee enthusiasts. This niche market enabled Starbucks to expand into five stores that sold coffee beans, a roasting facility, and a wholesale business that served local restaurants. At this time, Starbucks did not serve coffee and would not be recognized as the company they are today.

In 1982, Howard Schultz joined the organization as the manager of retail marketing and attempted to implement new ideas and a new business model for the organization. Schultz was inspired by the Espresso bars of Europe and saw the potential for establishing this type of European coffee culture in the U.S. market. Schultz’s idea was soundly rejected by the original owners and he left the organization and established a chain of coffee houses, themed after Italian café’s and they sold brewed Starbucks coffee. In 1987, Schultz bought Starbucks from the original owners and began to implement a strategy of growth that was built on a solid foundation of core values and solid management.

Schultz recognized the potential of the specialty coffee market, a market which was still in its infancy and undefined. Starbucks and Schultz wanted to become the market leader and help shape the market and the customer expectations that surrounded the