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Starbucks was founded by Jerry Baldwin, Gordon Bowker, and Zev Siegel in the year 1971 in the Seattle's historic Pike Place Market. For the first ten years of its being, Starbucks Company dealt with selling fresh roasted gourmet coffee beans as well as other accessories, and these were used for the brewing and roasting process. It was until 1982 when the founders of the Starbucks Company allowed an entrepreneur by name Howard Shultz to join them. Howard Shultz worked as the company's Director of Marketing and Retail Operations (Marie 87).
As Howard Shultz was on a trip to Italy, he encountered Italian coffee culture, which constituted cheerful customers sitting around the tables as they were drinking coffee. The café seemed to work as a place in which Italians used to meet for their leisure time activities. For all he had seen, Howard Shultz considered that the coffee culture could be simulated in the United States of America and that could be replicated in United States, and that the amalgamation of coffee cafés in Starbucks stores could introduce the coffee culture here (Marie 89).
Growth and expansion
In the beverage industry, Starbucks is recognized as possessing an extraordinary real-estate and store improvement talent. Each and every Starbucks store is designed in its own way. This is usually unavoidable since Starbucks either leases or buys the ready built premises and changes them into Starbuck store, and not building its own stores. In the financial year 2006, Starbucks put into use 2,199 new stores; hence the total locations summed up to 12,440. Starbucks engaged in a growth strategy of unusual increment of the number of Starbucks stores in large cities irrespective of the fact that the new stores cannibalized stores customers in the close proximity. After setting up a centre of stores in a city they then show commitment of expanding outward to immediate residential districts. Most people have welcomed Starbucks into their communities as it serves them like their gathering place. In spite of the fact that Starbucks has expanded worldwide, it has remained watchful to giving respect to the conflicts in culture as well as responding faster in case if conflict and misunderstanding (Goodwin 422).
In the beginning the company targeted the group of people who would be able to buy a cup of coffee worthy $3 and also to spend time together with friends at the stores. Social classes, young college and university students, and neighborhoods constituted the target group. Owing to rapid growth and expansion, the target market for Starbucks expanded to covering the needs of every person of whichever age and status. Starbucks targeted rural communities, small towns, highway rest stops, ethnic neighborhoods, and markets in which a variety of coffee shops exists. What started as a corner target market ultimately came to contain consumers from all aspects of life (Vogel 105).
Type of Products
Product-mix in Starbucks Company increased from 30 forms of whole bean coffees to environmental-friendly cappuccino coffee and coffee makers as well as other Starbuck possessions. The company's product contributions have also gone beyond coffee and pastries to smoothies, wraps, and oatmeal to avoid effects of competition from other companies and also to fulfill the needs of customers. The company has persistently been bringing in new products like "Full Leaf Tazo Tea Lattes", "Tazo Tea Infusions" and "Instant via Ready". The Instant via Ready refers to the instant coffee that according to the company is similar to its ordinary brewed coffee. Full Tazo Tea Infusions and Leaf Tazo Tea Lattes are the company's latest tea offerings by which many tea drinkers will be attracted (Claudia 260).
Global warming is a most important concern for the well being of Starbucks as it may not favor the production of the raw materials necessary for the company's activities. To combat the global warming threats, Starbucks has In response to the threat of global warming Starbucks has employed a three year Climate Change Mitigation strategy intended to purchase renewable energy, so that to ensure that energy has been conserved as well as encouraging collective action (Moe 38).
For an energy source to be referred as renewable, it must me replaced naturally. For example methane which is a natural cooking gas is renewable. Starbucks Company has purchased 100% wind renewable energy certificates, doing away with 124 million pounds of carbon (IV) oxide gas. Starbucks shared its energy buying with other companies, and was in a position to attain renewable energy pricing just close to its' usual pricing (Moe 40).
Starbucks has tried to encourage collective action so that to arrive at a solution to the global warming calamity. They have ensured the teaming up of many organizations so that this vital issue can be tackled.
The Starbucks outlets have been positioned as places where customers can spend and enjoy their leisure time while away from either work place or home. In order to achieve this, each of the Company's stores is made as comfortable and soothing as possible. Some of the things that ensures comfort in the Starbucks stores are; comfortable furniture, soothing music, offerings like wireless internet, complimentary books, handicapped access, and general places for teamwork. Even if the Starbucks stores are used as locations at which consumers can utilize their free time in a soothing setting, their products are of highest quality and more expensive (Cassia 168).
Starbucks Company which is dealing with most affordable tangible product has developed into a company that is performing much more than what has been usually done. Starbucks is trying to promote its philosophy and image as a responsible company pertaining to its products.
The competitors of Starbucks in the coffee beverage sale are Dunkin Donuts, Seven-Eleven, BIGGBY Coffee, McDonald's, Einstein Bagels, Caribou Coffee, and Panera Bread. McDonald's and Dunkin Donuts have got wide-ranging menus as well as substantial financial resources, and favorable hence threatening Starbucks' tendency to make good profit. Dunkin Donuts and 7-Eleven, supply coffee in a direct fashion hence attracting clients who are very sensitive about price. The environment of Caribou Coffee is like that of Starbucks in terms of free internet, furniture, and comfortable atmosphere, but since it lacks lack market expansion, it cannot gain the notoriety Starbucks has attained. In the middle ground is BIGGBY Coffee where the likes of Caribou Coffee and Dunkin Donuts divide themselves (Vogel 115).
Dunkin' Donuts is a doughnut franchise possessed by a parent company called Dunkin' Brands. Dunkin' Donuts was founded by Bill Rosenberg in Quincy, Massachusetts in the year 1950. From that time Dunkin' Donuts has been ensuring stability for the snack food sector in the geographical market of New England. Dunkin' Donuts produces quality pastries and doughnuts, as well the most delicious espresso and coffee blends. It is the Dunkin' Donuts that dominates the snack food sector today (Cassia 168).
Growth and expansion
Dunkin' Donuts has started a strategic and steady national development in both new and the already existing Dunkin' Donuts markets. Dunkin' Donuts is particularly aiming at the markets within the South and West, including Birmingham, Austin, Dallas, Kansas City, Houston, Milwaukee, Las Vegas, Phoenix, Nashville, Tampa and St. Louis.
As from January 2010, Dunkin' Donuts put into function 338 net new locations around the world with 75 of the new restaurants launched in the United States. As well, the Dunkin' Donuts signed 72 fresh domestic development dedications (Goodwin 322).
The Company signed multi-store expansion agreements within 14 markets around the country in the first half of the year 2010. These markets include South Bend, IN; Detroit, MI; Miami, FL; Chicago, IL; Fayetteville, NC; MO, St. Louis, and many others. In most cities around the country, Restaurants have been opened. Some of these cities are Raleigh, NC; Tampa, FL; Atlanta, Phoenix, AZ; GA, and many other cities within the country. In order to maintain the brand competitive and fresh, Dunkin' Donuts provides franchisees flexible design ideas for instance, end caps, gas stations, kiosks, in-line sites and free-standing stores, same as other retail atmospheres (Laura 89).
In the year 2008, Dunkin' Donuts made a very important step in the direction of improving the environment in the region where it operates. The Leadership in Energy and Environmental Design (LEED) certified restaurant was opened in St. Petersburg, Fla. LEED certification is extensively acknowledged as the standard for "green" structure within United States of America. The St. Petersburg LEED unique restaurant is part and parcel of the bigger Corporate Social Responsibility (CSR) dedication that will offer the company with an essential outline of orientation for organizational strategic goal setting, decision making, and behaviors that give value to the major stakeholders. The stakeholders include employees, consumers, communities, franchisees, suppliers, environment, and the government. These green building principles integrated into the St. Petersburg restaurant, will boost the future Dunkin' Donuts' building models (Moe 43).
Type of Products
Dunkin' Donuts was the first ever national trademark to supply espresso beverages that are manufactured absolutely with Fair Trade Certified coffee. The beans for the Dunkin' Donuts espresso beverages, with latte and cappuccino inclusive, get certified in TransFair USA which is the only self-sufficient certifier of the Fair Trade products in the United States (Vogel 97).
Dunkin' Donuts does not experience competition from other companies so much. Enabling Americans running the whole day with the highest-quality coffee has always set Dunkin' Donuts brand at a distance from competitors.