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Running head: Starbucks SWOT Analysis
Starbucks SWOT Analysis
Running head: Starbucks SWOT Analysis
Executive Analysis
Starbucks Corporation, founded in 1971, is a retailer of specialty coffee. Starbucks retails a
variety of drip brewed coffee, espresso-based hot drinks, other hot and cold beverages,
complementary food items, coffee-related accessories and equipment, teas, ice cream, and
items such as mugs, coffee beans, and music and other non-food products through retail
stores in approximately 39 countries worldwide. The company operates primarily in the
US. It is headquartered in Seattle, Washington and employs about 150,000 people.
Starbucks mission is To inspire and nurture the human spirit* one person, one cup, and one
neighborhood at a time (www.Starbucks.com). Top management believes in involvement
in the activities of the corporation and employees enjoy unsurpassed benefits in the
industry. Schultz strongly believes that Employee satisfaction is directly related to
customer satisfaction.
The company recorded revenues of $7,787 million during the fiscal year ended October
2006, an increase of 22.3% over 2005. The operating profit of the company was $894
million during fiscal year 2006, an increase of 14.5% over 2005. The net profit was $564.3
million in fiscal year 2006, an increase of 14.1% over 2005. Its very strong financial
position allows it to expand aggressively domestically and internationally.
Situational Analysis
In regards to the coffee bean market, although it has endured much criticism for its
purported monopoly on the global coffee-bean market, Starbucks only accounts for
roughly two percent of global coffee production. According to Starbucks, they purchased
4.8 million pounds of Certified Fair Trade coffee in fiscal year 2004 and 11.5 million
pounds in 2005. They have become the largest buyer of Certified Fair Trade coffee in
North America, 10% of the global market, and the only company licensed to sell Certified
Fair Trade coffee in 23 countries.
SWOT Analysis
Strengths
Starbucks Corporation is a very profitable organization, earning in excess of $700 million
in 2006. It is a global coffee brand built upon a reputation for fine products and services.
Due to its specialization in all things coffee, it achieves high buying volumes, and utilizes
international sourcing, some from fair trade suppliers. It has almost 9000 cafes in almost
40 countries. Starbucks was one of the Fortune Top 100 Companies to Work For in 2007,
ranked at number 16 (www.money.cnn.com). The company is a respected employer that
values its workforce. The organization has strong ethical values and an ethical mission
statement as follows, Starbucks is committed to a role of environmental leadership in all
