Starbucks Corporations Industry, Market and Competitor Analysis
Starbucks Corporation is a renowned retailer of coffee in America. The firm has several
outlets across the globe which has enabled the business to acquire the prestige name that it holds
in the coffee retail and fast foods industry. The company has been in existence since 1971, and it
has thrived in the hospitality industry owing to the employing of unique strategies (Starbucks,
2017). This essay analyzes the market, industry, and competitors of Starbucks Corporation with
the aim of understanding the strategy employed by the organization.
The industry analysis of the Starbucks Corporation involves the analysis of the
environment in which the firm operates. Notably, this coffee retailer carries out its activities in
the coffee retail and fast foods industry where several firms compete for the same market. Some
of the major players in this industry include McDonalds restaurants, Burger King, and Dunkin
Donuts. Using the SWOT Model, it is evident the firm holds several strengths which include a
large number of outlets that increase the brand presence of the firm. A large number of outlets
has enabled the business to hold more than 60% of the American coffee market share (Statistica,
The external environment provides several opportunities for the firm such as increasing
their markets in Africa and Middle East countries. These countries offer the opportunity of
and coffee customized to these markets. Though the industry looks
lucrative, the Starbuck Corporation is faced with various threats which include the threat of
coffee being replaced with substitutes. As the years progress, people are becoming more health
sensitive and hence prefer organically grown foods. Foods served in coffee houses are usually
termed as junk foods, and hence the Starbuck may lose their market to the organic foods
An analysis of the competitors shows that the main competitors of Starbuck Corporation
are the Dunkin Donuts, McDonalds Restaurant, and Burger King. These businesses offer closely
related foods such as coffee, burgers, donuts, French fries, and tea which form part of the Menu
of Starbuck Corporation (Starbucks, 2017). The three companies mainly compete with Starbuck
for the coffee market. Notably, McDonalds uses the price leadership strategy to maintain their
competitive edge while, on the other hand, Burger King, and Donut Kin use diversification as a
means of taking a share of this lucrative market. Therefore, to overcome the intensified the
Starbuck Corporation needs to consider adding various flavors of coffee, tea and other beverages
on their menu. Also, the firm needs to include several types of products to meet the tastes and
preferences of the customers.
Market analysis refers to the portion shared by the firm in the given market of their
products. The statistics of the year 2017 indicate that the Starbucks corporations had 27,339
outlets, this number of outlets represented 39.8% of the (Statistica, 2017). The
Starbuck was the leader among the coffee houses followed by Dunkin and other businesses. The
great market share indicates the firm has been performing well. Nonetheless, the organization
has the capability of increasing the market share through employing different strategies. New
products such as spiced French fries, iced coffee, coffee flavored water and yogurts are some of
the products that may be served by the firm. This would result in an increase in the market of
Starbucks as well as the rise in revenue.
Starbucks,C. (2017). Company Information . Retrieved from Starbucks:
Statistica. (2017). Market share of the leading coffee chains in the United States in 2016.
Retrieved from Statistica: https://www.statista.com/statistics/250166/market-share-ofmajor-us-coffee-shops/
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