Research and Markets: Starbucks: Business revival in recession

Fri Dec 7, 2012 1:07pm EST

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Research and Markets: Starbucks: Business revival in recession

Research and Markets (http://www.researchandmarkets.com/research/fw8q66/starbucks) has announced the addition of the "Starbucks: Business revival in recession" report to their offering.

Starbucks Corporation, established in 1971, was named the Number One World's Most Innovative Food Company by Fast Company in 2012. This was attributed to the company's revival of its business during recession. This case study will examine how Starbucks was affected during the recession, the strategy used to pull the company back into profit, and the effects that this strategy had on the company.

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Highlights

When Starbucks was first established it did not sell drinks; it was not until Howard Schultz bought the company in 1987 that it began to operate as a chain of coffee bars. The establishment of Starbucks as a coffee retailing chain marked the beginning of a new consumer trend.

Prior to 2008, Starbucks had been growing rapidly in terms of store openings, revenues, and operating profit. However, this all changed as the recession hit and the company struggled to cope. Starbucks became a victim of its own overexpansion. Furthermore, mass branding became detrimental to the company.

Starbucks embarked on a new strategy to turn the business around. The company shifted its focus from expanding the brand to enhancing the brand. A range of initiatives were introduced, including closing stores, expanding internationally, introducing new products and initiatives, and debranding stores.

Your key questions answered

- What difficulties did Starbucks fall into in recession?

- What were the causes of these financial problems?

- What strategy did the company use in an attempt to turn the business around?

- How successful was this strategy?

Key Topics Covered:

OVERVIEW

- Catalyst

- Summary

ANALYSIS

- Starbucks established the first retail outlets of its kind

- Howard Schultz transformed Starbucks

- The new Starbucks format marked the beginning of a new consumer trend

- The company expanded quickly

- Other companies soon followed suit

- Starbucks fell into financial difficulty

- The recession had a negative impact on the company

- Starbucks grew too rapidly

- Starbucks embarked on a new strategy to turn the business around

- The company closed underperforming stores

- The company embarked on global expansion

- The company increased its prices

- Starbucks used innovation as a strategy for growth

- The company has renewed its focus on quality

- Many Starbucks stores were effectively debranded

- The company has utilized corporate social responsibility strategies to improve the brand image

- The company's strategy helped to propel it back into growth

- Operating profit for the company returned to growth in 2009

- The brand value of the company has increased

CONCLUSIONS

- A range of initiatives improved the fortunes of the company

- The company plans to focus on Europe in the future

APPENDIX

- Sources

- Further Reading

- Ask the analyst

- About MarketLine

- Disclaimer

For more information visit http://www.researchandmarkets.com/research/fw8q66/starbucks

Research and Markets
Laura Wood, Senior Manager.
press@researchandmarkets.com
U.S. Fax: 646-607-1907
Fax (outside U.S.): +353-1-481-1716
Sector: Retail

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