Transcript Document 7120353

Issues and Outlook
For Next 3-5 Years
•Become best known brand
• Move into areas other than coffee
• Expand beyond retail outlets
• Develop a Global presence
• Determine Acceptable Growth Rate
External Analysis
Opportunities
• International Expansion
• Different Product Lines
• Co-Branding
• Expansion of Target Market
External Analysis
Threats
• Low Barriers to Entry
• Extreme Reliance on Commodity
• Limited Quality Suppliers
Internal Analysis
Strengths
• National Brand Recognition (Coffee)
• Skilled/Knowledgeable Employees
• Perfected Roasting Techniques
• Product Proliferation
• Real Estate Strategy
•Tremendous Growth
Financial Highlights
Net Revenue (in millions)
1800
1600
1400
1200
1000
800
600
400
200
0
1995
1996
1997
1998
1999
Financial Highlights
Net Earnings (in millions)
120
100
80
60
40
20
0
1995
1996
1997
1998
1999
Internal Analysis
Weaknesses
• Supply Chain Operations
• Not available in Grocery Stores
• Limited Market Segment
• Commodity Reliance
• Dependent on Debt and Equity to
Grow
Mission
To establish Starbucks as the most
recognized and respected brand in
the world
Goals
• Slowed but Continued Growth
• Expansion of Specialty Lines
• Selectively Pursue other Opportunities
Our Plan
Enter Grocery Store Market
• Place Doppios or similar stands in stores for
initial entry--Start only on East and West coast(
• Hire Marketing Executive to Develop National
advertising campaign
• Use Coupons during First Year for all Starbucks
Products
• After Initial Entry--Basic Coffee Line
Our Plan
Establishing new relationships
• College Vending machine Contracts--at
least 1 in each Coastal State
• Airline Contracts--2 Major Airlines
• Office Services--Sign on 50 New Offices
a Year
Our Plan
Specialty Operations
• Expand ShopStarbucks.com
• Expand Brewing Equipment lines
• Develop 4 New Ice Cream Products
• Develop Teas and Juices Lines
• Develop liter bottle of Frappucino
Our Plan
Strengthen Distribution Channels
• Conduct Semi-annual Training Seminars
with Suppliers to Attune Suppliers to
Company’s Needs
• Integrate Suppliers and Franchisees in
Decisionmaking Process
• Establish a Contract with UPS to be Sole
Shipper of Starbucks Products
Financial Highlights
Retail Store Count
2500
2000
1500
Licensed
Company-owned
1000
500
0
1995 1996 1997 1998 1999
Our Plan
Franchise more stores
•25% of New Stores will be Franchised
•10% of Existing Stores Franchised Each
Year
• Conduct Quarterly Franchisee Training
Meetings to Ensure Top Quality and Service
Our Plan
Growth
• 750 New Stores in US
•100 New Stores in International market
• Branch into one New Country Each Year
• Co-brand with an International Company to
Better Serve Regional Tastes
What’s New for Starbucks