The article talks about the rapid growth of Starbucks and
the initiatives that they are taking to expand their brand and capture more
market share in the future. Starbucks operates more than 20,000 stores
worldwide. Starbucks added 1,599 stores to its worldwide footprint
and comparable store sales rose 6%. That boosted revenue by 11% to more than
$16.4 billion.
Starbucks'
full-year adjusted earnings per share (EPS) grew 21% year over year to $2.66,
helped by strong margin performance. The company also projected that adjusted
EPS will reach $3.08 to $3.13 in 2015, which translates to 16% to 18% growth.
Not only by selling more pastry items, Starbucks also
started selling of wine, beer, and small-plate appetizers at a few locations through
the Starbucks Evening concept for some time now. This boosted their overall
sales as well. In addition, Starbucks expanded its brand by offering more
options for Tea, considering the huge market of Tea drinkers worldwide, for
instance by introducing more Teavana branded beverages at their stores.
Starbucks also announced their plans to roll out mobile
orders and pay functionality chainwide in 2015. Customers will be able to place orders in advance and pick up their
orders without waiting in line. Starbucks describes it as the urban answer to
the convenience of drive-through.
Beginning next year,
Starbucks will also use this platform to offer delivery in some top urban
markets. Schultz's vision is that a customer could place a standing food or
drink order and have it delivered to his or her desk every day. If this concept
takes off, it will represent a huge long-term differentiator -- and growth
driver -- for Starbucks.
Owing to Starbucks’s
great growth opportunities, many investors have already shown interest to buy
stocks of Starbucks. If this trend continues and that Starbucks comes up with
more digital and innovative ideas of serving its customers, it might not be too
long that they capture maximum market share from their competitors and
eventually gain monopoly power in the beverage market.
Starbucks is already at the top of their market and I think they are making all the right decisions moving forward. I had to do a project in a previous class on their environmental initiatives and I know their Earth-friendly message and actions definitely help their popularity among consumers. Now, they are expanding past just the tea/coffee business and offering all kinds of beverages and even more foods, making them appeal to an even wider audience, one that is not only thirsty but also hungry. I think this growth, paired with their already outstanding public relations and popularity will lead to more profitability for investors and financial success of the company. Starbucks is definitely doing all the right things and gaining more power in their industry so hopefully a competitor will come up with something new so Starbucks isn't sitting at the top with a monopoly on the market like Akram mentioned.
ReplyDeleteI agree with Jake, I feel as though Starbucks may already have monopoly control over the coffee market. When I hear someone talk about getting coffee the first place I think of to look for is Starbucks. I honestly don't know many other predominately coffee companies, only one other company really comes to mind, Caribou. Starbucks seems to be doing everything right when it comes to innovating and I think this is what is gaining them this monopoly power.
ReplyDeleteStarbucks is undoubtedly the strongest company in the coffee market. Its expanded menu is only going to make Starbucks stronger. They've also done a good job of making themselves a company that employees want to work for, as I've read that they spend more on healthcare insurance for employees than they spend on coffee beans in a year. They also have a college achievement plan to help employees complete a college degree. Overall, Starbucks is a company that will definitely be around for quite a while.
ReplyDeleteStarbucks is the strongest company in the coffee market because they continue to evolve and market their products. Starbucks is consistently coming up with new ways and ideas to promote their product. I believe that as long as Starbucks does not become complacent, they will eventually seize monopoly power of the market.
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