The Previous Management Policy of StarbucksThe Previous Management Policy of Starbucks Just in forty years’ time from the beginning to now, Starbucks has made remarkable achievements. During the periods, Starbucks had been exploring and improving better management policies, which aims at its perfection, but it encountered setbacks as well.There are three main parts of Starbuck’s previous management policy. Firstly, Starbucks took the joint venture and franchise way in China originally. In Beijing and other Chinese local market, Starbucks entered the initial stage by accounting for no authorized shares to adopt purely business model. Taking China’s special market conditions into account, it may face high environmental uncertainty and market responsiveness of local issues. Thus, the franchise policy implemented in the early stage did absorb, maximize foreign capital and expand their territory. However, from franchise modes, Starbucks could only gain a small amount of bonus from its operating revenue. Owing to China’s immature laws of franchise, it’s easy to breed a variety of issues, which was not good for the development of Starbucks.
Secondly, Starbucks mainly adopted the differentiation strategy previously. The three founders were inspired by entrepreneur Alfred Pet to sell high-quality coffee beans and equipment. Gallaugher indicates, the store did not offer fresh brewed coffee by the cup, but tasting samples were sometimes available. The store was an immediate success, with sales exceeding expectations, partly because of interest stirred by the favorable article in Seattle Times. And Starbucks would open the number of branches on the basis of the population of the region. Depending on various consumer groups and consumer taste, the company would set different prices. By doing so, Starbucks attracted those white collars who had high brand loyalty and low price-sensitivity. They gained high profit above average level. But customer’s purchasing power was limited, consumer flows was vulnerable. And the gap of cost between Starbucks and its rivals was massive.
The first two cases have shown where that was not possible. Since then, the company has begun to sell and distribute products made for a specific brand, rather than from a brand-specific source.
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In our case as well, both cases were able to be accommodated by the consumers through what is now a new Starbucks brand. The decision for the consumer to buy directly from a new Starbucks store was influenced by “consultational factors.” These included the perceived high consumer loyalty to Starbucks and increasing acceptance of Starbucks branding. This was not the case for the case of the original Starbucks store, as the consumer was able to purchase directly by entering a small number of locations for a small cost in an effort to make more easily reachable through the Internet.
While there are many ways to handle this, it is important to understand that customers may not be able to purchase directly from a Starbucks store as well, even on more generous terms.
The best way to support customers and grow customer-consumers is through a Starbucks store. By doing so, customers can access their choice menu and provide them with the best value without any effort from the store. Consumers can also use Amazon as their own fulfillment center. Thus, more than just a food-delivery service, we can provide consumers with a convenience food option for their convenience. At the same time, more than just a coffee shop, we can provide products to consumers using existing supply chains such as food-delivery firms and warehouse chains within the same business space where Starbucks is located.
A product can be made by a different brand to a different part of the retailer, or even to an equally unique part. We know this is possible but need to figure out a mechanism that allows this.
(1) The retail space at Starbucks is a large location with many employees from different companies. The employees in question are in-person and have no interaction with any of the store’s employees. In addition, the store is located on public transit, which can often be difficult for customers who are directly located in Starbucks Stores nationwide.
A food and beverage location provides shoppers with a convenient,