Strategic Analysis Project: Company and Industry Analysis

Strategic Analysis Project: Company and Industry Analysis
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Strategic Analysis Project: Company and Industry Analysis
A SWOT analysis of Starbucks’ internal and external environment shows areas where the company has strengths, weaknesses, opportunities, and threats. The company’s internal environment is based on its strengths and weaknesses. The strengths include a globally established brand; profitable retail stores operated the firm both locally and abroad, highly motivated workers, customer loyalty. It also has an excellent working relationship with suppliers, widespread and consistent business activities, as well as knowledge-based decisions and practices (Lombardo, 2019). Weaknesses include its large size leading to challenges in cross-functional management, much focus on expansion rather than internal development, a growing number of competitors, expensive product pricing that keeps some customers away, as well as generalized and imitable products (Lombardo, 2019).
The external environment can be analyzed through the firm’s opportunities and threats. Examples of opportunities for the firm are technological advancements, expansion to new geographical locations across the world, new development channels, expansion of the Starbucks brand, domination in the local and international business environment, and alliances of partnerships with other companies (Lombardo, 2019). On the other hand, threats facing Starbucks include intense competition from coffee shops and other small businesses, imitation by new entrants, possible saturation of the local market in the U.S, volatile coffee prices in less developed countries, consumer trends tending towards lesser use of caffeine products, cultural and political issues in some countries, as well as independent coffee house movements that may influence customer behaviour (Lombardo, 2019).
Based on Porters’ Five Forces Analysis, the strong forces affecting Starbucks are competitive rivalry, buyer power, and the threat of substitution (Greenspan, 2019). Moreover, the threat of new entry is a moderate force, whereas the supplier power is a weak force (Greenspan, 2019). Firstly, external factors leading to the strong force of competitive rivalry include numerous ...