Opportunities
To extend supplier network. Starbucks doesn’t grow its own coffee beans but has to buy them from various suppliers, which are mainly clustered in South America, Arabia or Africa. For Starbucks to ensure critical supplies for its operations in Asia, reduce the dependence of good or bad harvests in Africa and South America and to save on shipping costs, Starbucks has to extend its supplier network.
Expansion to emerging economies. There are great opportunities for coffeehouses in China and India, in which Starbucks has comparably only modest number of restaurants.
Increase product offerings. The business could expand the number of coffeehouses that offer wine and beer, plus adding some new products and reaching broader customer group.
Expansion of retail operations. Starbucks does not only manage coffeehouses and franchises but sells some of its products through other retailers. The firm should form more of such partnerships and offer to sell its coffee, for example, in supermarkets.
Threats
Rising prices of coffee beans and dairy products. The chain strongly depends on the coffee beans and dairy products prices, which Starbucks cannot control or can hardly estimate.
Trademark infringements. The company is often involved in cases over illegal use of its trademark, which is costly and detrimental for Starbucks.
Increased competition from local cafes and specialization of other coffeehouse chains. Local cafes can offer much lower price and more suited menu for its customer. Big coffeehouse chains specialize so they wouldn’t need to compete head-to-head with Starbucks. In both situations, Starbucks experiences intense competition and loses market share.
Saturated markets in the developed economies. Coffee markets in the developed economies are already saturated and with intensifying competition, Starbucks will find it hard to grow in these markets.
Supply disruptions. Due to political, economic and weather conditions Starbucks may experience supply disruptions, adding significant cost to the firm.