Starbucks Global Expansion Case Study

Pages: 2 (670 words)  ·  Bibliography Sources: 1  ·  File: .docx  ·  Level: Master's  ·  Topic: Business

Starbucks

The explanation for the reversal of the franchise/company-owned split is that franchising allows for easier entry into foreign markets. With some countries, like China, dealing with the government is much easier with a Chinese partner, but even in relatively free-market countries a local partner is valuable. Local partners have better knowledge of local tastes and local working conditions, so Starbucks is able to gain faster and more effective market entry by utilizing the expertise of a local franchiser. Not only does the local franchiser have better knowledge of local workforces, but they are also able to tailor the menu and the overall Starbucks experience to the needs of locals. The result of this is that the local franchiser is more likely to succeed, by tapping into the local tastes more effectively, than the company would if it owned the stores. The government factor cannot be overlooked, however, as the entire process of dealing with the local legal and regulatory environment is likely much smoother for local companies than it is for the major company.

Starbucks has more control with a company-owned store, and when expanding internationally to countries where it is easy to deal with local officials and local culture, Starbucks is much more likely to utilize company-owned stores. For example, Starbucks in Western Europe and Canada are more likely to be company-owned than franchised, while in Asia and the Middle East the company is more likely to use a local franchise partner.Download full Download Microsoft Word File
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Case Study on Starbucks Global Expansion Assignment

2. I agree with the two decisions that Starbucks made. The first issue, the VIA, is a good policy because the ready-to-serve market is actually quite large. This product is largely sold on the institutional market, and VIA is the first serious attempt that Starbucks has made at entering this market. It can sell more in offices, hotels and institutional settings with the VIA, allowing it to reach more customers. The company is simply taking advantage of a market opportunity that has always existed in the coffee industry but that it… [END OF PREVIEW] . . . READ MORE

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Starbucks Global Expansion.  (2012, May 8).  Retrieved April 12, 2021, from https://www.essaytown.com/subjects/paper/starbucks-global-expansion/89552

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https://www.essaytown.com/subjects/paper/starbucks-global-expansion/89552.