Resuming Internationalization at Starbucks Harvard Case Solution & Analysis

Problem Statement

Starbucks, the largest coffee retail or in the world is facing critical challenge pertaining a decision to be made regarding its international operations. The company decided to ignore global operation due to recession, intense competition and the raise in the prices of the coffee beans. However, the company has been quite successful financially in the past 3 years which is why the company is aiming to pursue its global operations once again.

However, the company need to decide on the approach that will be essential to pursue global operations, the pace, the regulatory constraints and the geographical scope. Besides that the company need to analyze the key factors from the previous global experiences of the company that will facilitate the new expansion strategy.

Internal Analysis

This section will use SWOT model to conduct the internal analysis of the company and will help in identifying the right set of facts and figures that are apparent in the case. Besides that this analysis will be helpful in assessing the inertial strengths and weaknesses of the company and will guide in deciding on the threats and opportunities present for the company.

Furthermore, this will also help in analyzing the main strengths of the company that can be utilized as competitive advantage leveraging VRIN model. This model will assess few strengths that serve as competitive advantage for the company. This section will provide ample information to put the analysis in the right direction and decide the alternative solutions for the company regarding the decision.

SWOT Analysis


Starbucks is a well-established brand and its revenues have been increasing by 5% each year. The company has shown consistency in the quality of its brands which is why a perception is built amongst customers that it is America’s third place after home and work. The work environment is valued by the company’s employees as Starbucks has the highest employee satisfaction rate that leads top low turnover rate and translate the success of Starbucks as an organization. Starbucks has over 17000 stores and had a strong international presence and experience. The brand equity of the company is quite high and serve as a source to generate strong customer base. These strengths allow the company to become responsive towards the environment as well which also is a strong strength of the company.


Due to focusing more on growing its business, the company has stopped following its customers as their strategy has shifted from customer-oriented approach towards growth-oriented approach which has resulted in the loss of customers and increased dissatisfaction. The prices of its products are continuously rising which is also the reason why customers have switched from Starbucks to other low cost coffee houses after recession.

 As the heaviest users of Starbucks customize the coffee, it normally slows down the process. The company had no chief marketing officer due to which the company lacked the decision making ability in the marketing department. Moreover, the speed of service which was the core unique selling proposition of the company has declined.


The rising coffee consumption around the world has also increased the demand for Starbucks as it is considered to be a top brand and therefore, it provides an opportunity to the company in marketing to different countries. Rapid retail expansion from the company is an opportunity towards fulfilling the demand across the globe. However, a new terminology has emerged that the company can look upon to as a major opportunity. The company can enter in various newly developed and developing markets and to capture the maximum market share, pursue co-branding.  The Chinese market presents a lucrative opportunity due to its size and the highly developed market.Resuming Internationalization at Starbucks Case Solution


There is a rising competition because of the increase of many specialty coffee shop offering. Also, many specialty coffee producers have been offering coffee for a better and lower price than Starbucks. There is an image developed in the mind of a consumer that Starbucks care about their customers just to earn money.

This image of commercialization has badly affected the image of the company because the company whose primarily concern was customers have been turned away making more money in the name of customer relationship management. The international expansion is restricted due to the entry barriers hindering in the way........................

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